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THE DYNAMICS OF INFORMAL TRADING IN
WESTCLIFF CHATSWORTH
A CASE-STUDY OF THE BANGLADESH MARKET
SHIKAR. S. SINGH
This thesis is submitted in partial fulfillment of the requirements for the Masters
Degree in Urban and Regional Planning in the Departments of Town and
Regional Planning and Development Studies at the University of Kwa Zulu-Natal.
2004
ALL WORK FOR THIS DISSERTATION WAS
COMPLETED AT THE FORMER UNIVERSITY OF
NATAL, DURBAN.
11
ACKNOWLEDGEMENTS
It gives me immense joy to express my sincere thanks and gratitude to a number of
people for their assistance and co-operation over the past few years. It is through all of
you that I have enjoyed the success of completing my masters. I pray that we all live
as a family together forever.
• Firstly the lord, Shri Sathya Sai Baba for my strength and guidance throughout
my study.
• My mum and dad for their guidance and support.
• My brother, Amith for providing me with the opportunity to study and sisters,
Raksha and Amika for their inspiration, support and love.
• My aunts and uncles for your encouragement.
• Aunt Nuthan for all your help, assistance and time through the fieldwork and
write up of this dissertation.
• My supervisor, Professor Peter Robinson for his constructive advice and
guidance.
• To all the people of the Bangladesh Market, for your co-operation. I hope that
this research makes a difference to your lives.
11l
TABLE OF CONTENTS
Acknowledgements
List of Tables
List of Maps
List of Figures
Appendices
CHAPTER ONE: Research Framework
Page
iii
vii
vii
vii
vii
1.
1.1.
1.2.
1.2.1.
1.3.
1.4.
1.5.
Introduction
Research Problems
Research Question
Subsidiary Questions
Hypothesis
Previous Research in the Field
Chapter Outline
1
3
3
3
4
4
5
CHAPTER TWO: Conceptual Framework
2.1.
2.2.
2.~.
2.3.1.
2.3.2.
2.3.3.
2.4.
2.5.
2.6.
2.7.
Introduction
History of the Informal Economy
Terminology and Interpretations
Informal Economy and Informal Sector
Differences between Informal Economies in Developed and
Developing Countries
Street Trading in the Informal Economy
Labour Flexibility
Size and Scale of the Informal Economy
Informal Economy in South Africa
Relationship Between Formal and Informal Economies
IV
7
7
8
8
11
12
14
15
17
19
2.8. Gender Discrimination in the Informal Economy
2.9. Local Economic Development
2.10. Policy and Legislative Controls Towards the Informal Sector
2.11. Conclusion
CHAPTER THREE: Methodology
24
26
27
28
3.1. Introduction
3.2. Location of the Case-study
3.3. Methodology
3.3.1. Secondary Material
3.3.2. Primary Material
3.3.2.1. Interviews
3.3.2.2.
3.3.2.3.
3.3.2.4.
3.4.
3.5.
Sampling Technique
Interview Process
Participant Observation
Constraints and Limitations
Conclusion
30
30
34
34
34
34
35
37
37
37
38
CHAPTER FOUR: Analysis
4.1. Introduction 39
4.2. The Bangladesh Market Association 39
4.2.1. Members of the Association 39
4.2.2. Establishment of the Bangladesh Market and the Bangladesh
Market Association 40
4.2.3. Vendors at the Bangladesh Market 42
4.2.4. Monthly Income, Expenditure and Expenses 43
4.3. Commodity in the Informal Trade at Bangladesh Market 44
4.4. Traders 53
4.4.1. Profile of Traders 53
v
4.4.2 Supply, Suppliers and Reliability 53
4.4.3. Traders and Crime 55
4.4.4. Concerns of Traders 56
4.4.5. Traders and their Interaction with "Officials" 57
4.4.6. Business Skills, Training and Financial Management 58
4.4.7. Profitability of Trade and Traders Survival Strategies 59
4.4.8. Trade, Regulation and Control 60
4.5. Formal Businesses 61
4.5.1. Profile of Respondents 62
4.5.2. Relationship Between Formal and Informal Sector 62
4.6. Residents and the Bangladesh Market 63
4.6.1. Residential Support of the Informal Market 63
4.6.2. Advantages of Informal activities in the Area 64
4.6.3. Disadvantages of informal Activities in the Area 65
4.6.4 Advantage or Disadvantage? A Viewpoint 65
4.7. Clientele 66
4.7.1. Reasons for shopping at the Bangladesh Market 66
4.7.2. Issues of Concern and Suggestions from Clientele 67
4.8. Market Activity, Residents and the Association 68
4.9. The New Proposed Market 68
4.10. Conclusion 69
CHAPTER FIVE: Discussion. Recommendations and Conclusion
5.1. Introduction 70
5.2. Discussion 70
5.3. Recommendations 71
5.4. Conclusion 75
REFERENCES 77
VI
LIST OF TABLES
1. Size of the informal economy 16
2. Informal Economy by Occupation 2001 and 2002 17
3. Formal and Informal Economy Labour Market Trends, 1997-2001 21
4. Number and Percentage Formal and Informal
Workers, by Occupation 23
5. Earnings of Informal Economy Workers 25
6. Proportion of Occupations in the Informal Economy, by Gender 26
7. The number and composition of traders in the Market 52
8. Range of products together with their net profits and expenses 59
LIST OF MAPS
1. The eThekweni Municipality
2. Chatsworth and surrounding Units
3. Aerial photo of Westcliffe Business Centre
LIST OF FIGURES
1. The Bangladesh Market and its Statutory Body
2. Composition of the Bangladesh Market
APPENDICES
Appendix 1: Questionnaire for Street Traders
Appendix 2: Questionnaire for Residents
Appendix 3: Questionnaire for Formal Businesses
Appendix 4: Questionnaire for Clientele/Customers
Appendix 5: Questionnaire for Informal Traders Board
vu
31
32
33
40
52
81
86
88
89
91
CHAPTER ONE
RESEARCH FRAMEWORK
1. INTRODUCTION
"We encounter it in our every day life in such simple activities as buying acheap watch or a book from a street vendor, arranging for a handyman to dorepair at our home for cash, or hiring an immigrant women to care for thechildren or clean the house while we are away" (Portes and Hailer, 2002: 1).Many of these mundane activities are often unacknowledged, hence we donot realise its value. For example, the informal sector is a critical part of ourdaily lives in that it serves to meet our needs in our domestic responsibility,and for some people a survival strategy or economic sustainability.
This informal sector has touched the lives of millions of people worldwide,especially those from developing countries. It has evolved as an influentialsector over a short space of time. In the decades of the 1970s and 1980s, theinformal sector was considered. tQ be a marginal or negligible sector in acountry's economy. However, in the last decade there has been considerableturn-around and much emphasis is now being placed on the informal sector.This sector is now part of major debates in the arenas of policy making inSouth Africa.
The informal sector has contributed significantly to shaping the current statusof South Africa. It has featured in major debates of the political, economic andsocial arenas that have impacted on the transformation that took placerecently. Many people in South Africa have found alternate ways of earning aliving, either by choice or through force of circumstances (Krige, 1985). Thisphenomenon is more prevalent in the poorer parts of the country, especially inthe rural areas where people are desperate to earn an income to meet theirbasic needs. Many researchers and policy makers thus see the informalsector as a possible solution to the problems of unemployment,underemployment and the consequent poverty endemic in the country (Porteset ai, 1989).
1
South Africa's informal sector is similar to those in other developing countries.
However, because of apartheid policies, it can be spatially recognized that
informal traders first appeared in rural areas and later with the demise of
apartheid, began to infiltrate into the urban areas. This large scale
urbanisation has prompted planners to find solutions to problems of
overcrowding, congestion and other infrastructural requirements. In finding
solutions, it must be recognized that the informal sector is highly diverse in
nature and that the concept is always evolving and changing over time
depending on the context in which it is being applied, therefore solutions must
be elastic enough to adjust to the changing context.
The case study for this dissertation focuses on the Bangladesh Market in
Westcliff, Chatsworth. In this market, informal trading is predominant
especially the trading of fruit and vegetables. The informal trading centre
dates back to the 1980's when there was a lack of employment, increased
poverty as well as the presence of restrictive apartheid laws that removed
farmers off their lands (Group Areas Act) or restricted hawkers and traders
from gaining trading permits in the area. This forced many Indians,
determined to survive and make a decent livelihood, to begin trading illegally
in the square of Unit 3 shopping centre, what is now known as the
Bangladesh Market. The Bangladesh Market developed within the confines of
the surrounding Indian community, depending on the community to support
their business. The physical location of the Market is within the residential
area of Westcliff.
More than twenty years later, even after the removal of apartheid laws, the
Bangladesh Market not only still exists but thrives in these surroundings.
Growing in size and numbers (more traders and more customers), and
expanding to include people from other race groups, the Market is seen as a
way for many, not only to make a liVing but also a place where fresh produce,
meat, poultry and various other goods can be purchased at low prices.
2
1.1. RESEARCH PROBLEM
The informal sector has become an integral part of our society, contributing to
its social and economic upliftment. Street trading is the most common type of
informal activity being practiced. The motivation behind this study is to
understand the dynamics of growth and the problems that the sector endures
and its influence on the lives of the neighbouring population. Although many
informal street traders operate outside the reaches of formal law, they are still
doing an honest living to support their households and families, yet very little
is being done to improve their status. Understanding the racial history of
South Africa and its effects on this market has prompted this study.
The Bangladesh Market in Westcliff is a special case where the informal
trading centre exists within a residential area, amidst other formal businesses.
The study addresses the problems of a cluster of informal trading activities
located adjacent to formal businesses within a residential area. In the case of
the Bangladesh Market in Westcliff, the dissertation explores issues such as;
residential satisfaction and dissatisfaction with the Bangladesh Market in the
area and, relationships between formal businesses and the informal traders.
1.2. RESEARCH QUESTION
What is the nature and effects of informal trading in the Bangladesh Market
located in the residential area of Westcliff in Chatsworth?
1.2.1. SUBSIDIARY QUESTIONS
~ What types of informal trading activities are being practiced in the
Bangladesh Market?
~ What is the demographic composition (age, sex, total percentage of
population, economically active) of the traders in that area?
~ What are the advantages and disadvantages to traders of locating in
this specific area?
3
~ What are the impacts of this informal economy on surrounding
residents?
~ How do the informal traders affect the formal businesses?
~ How do informal traders contribute to the economy of the area?
~ How can the informal sector be promoted in a residential area in
relation to support from different stakeholders?
~ Are these informal traders sustainable on a long-term basis in relation
to deriving income from the goods that they sell or trade?
1.3. HYPOTHESIS
The informal sector is successful and lucrative in Westcliff, contributing to the
economic and social lives of those involved in it. It impacts positively on the
lives of the surrounding residents by creating income for them and providing
goods that are readily available, but it may affect them negatively in terms of
aesthetic appeal. Yet the net result appears to be positive. There is also little
state involvement in this area in terms of providing policy that will facilitate
expansion and progress of this sector.
1.4. PREVIOUS RESEARCH IN THIS FIELD
There has been intensive and extensive research on the dynamics of the
informal economy. Writers and researchers look at different ways of defining
this sector and in placing it in a specific context or area. The informal
economy was widely looked at in both developing and developed countries
(Portes et ai, 1989). South African literature also focuses considerable
attention on the informal economy. Initial attention was placed on the urban
areas of the three cities namely, Durban, Johannesburg and Cape Town.
However as momentum in the informal economy grew, it spread throughout
the country. In the last decade, attention has been focused on policy
development and implementation (Skinner, 2000).
In the Durban area the informal economy is thriving and much debate about
its development is taking place. Extensive studies have been undertaken on
4
the informal economy in and around the city centre. These1 include the fruit
and vegetable market in the Warwick Avenue, the arts and crafts market in
the Durban beachfront area, and informal trading on pavements in the city
centre. There have also been various case studies and pilot projects2 in
townships such as KwaMashu and Umlazi. Emphasis has been placed on
informal home industries in various residential areas. Trends on migration and
its impacts on the informal economy have also been well researched. It is
argued that large numbers of people subsisting in the informal economy are
immigrants.
To the best of the author's knowledge, very little research has been done on
the informal trading centre in the Westcliff area of Chatsworth. Although a
studl on home-based industries in Westcliff was done in 1995, to date there
has been no attempt to understand the dynamics of informal trading in
Westcliff, how it affects the surrounding residents and what policies or steps
local government is taking to improve or facilitate this sector. Furthermore, the
issue of an informal trading centre located within a residential area has not
been sufficiently explored.
1.5. CHAPTER OUTLINE
The remainder of the dissertation is arranged in four chapters and these will
be as follows:
Chapter two includes the conceptual framework. In this chapter are the key
concepts and the bodies of literature pertaining to the informal economy.
Chapter three presents the methodological approaches and techniques that
are used in executing the fieldwork carried out in this research. It focuses
attention on the specific case study of Westcliff looking at the dynamics of
I Refer to Durban's Informal Economy Policy, 2001; the work Ndinda, 1997 and that of Skinner, 1999.2 Refer to Krige, 19853 Naidoo, 1999
5
informal trading in this area. Maps detailing and placing the area in context
are also included.
Chapter four provides a detailed analysis of the findings that emerged during
the fieldwork phase. It covers the impacts of informal trading in a residential
area studying the communities that are involved and their perceptions. It
focused on creating and fostering development within a community with the
concept of participation. This chapter will attempt to bridge the gap between
informal traders, the formal businesses and members of the community.
Chapter five concludes the dissertation with evaluating the findings from the
previous chapters. It tests the validity of the hypothesis. In this chapter
recommendations are made based on the findings and analysis, which will
contribute to the future planning of this sector.
6
CHAPTER TWO
CONCEPTUAL FRAMEWORK
2.1. INTRODUCTION
This chapter contains the terminologies and interpretations, together with thebodies of literature on the informal economy. It outlines the maincharacteristics and provides an overview of the informal economyinternationally and in South Africa. These characteristics include therelationship between the formal and informal economies, genderdiscrimination in the informal economy, local economic development and,policy and regulation of informal activities.
2.2. HISTORY OF THE INFORMAL ECONOMY
The informal economy came into being and grew at an unprecedented rateduring the 1970s. This was due to the economic crisis that occurred during themid-1970s throughout the world, including South Africa (Bromley, 1979).Many countries at this time were going through the process of globalrecession and this created problems for millions of people who were in formalemployments. These people faced unfavorable and undesirable conditions inthe labour markets, which forced them to look for alternate forms of·employment. This initiated the informal economy in different countries.According to Portes, et ai, (1989) the expansion of the informal economycontributed to the process of economic restructuring during the structuralcrisis of the 1970's.
With globalization and trade liberalization, many workers "in the informaleconomy have been able to find new jobs or new markets for their productswhile others have lost jobs or markets" (Carr and Chen, 2002: 2). Numerousworkers have seen their working conditions deteriorate, their wages declineand their workloads decrease. With many countries pursuing capital-intensivegrowth, employment becomes reserved for those who are skilled and
7
educated, those people that do not fall into these categories are left behind
and they are the ones that tend to seek employment in the informal economy.
It is argued that the concept of the informal economy was first introduced by
Hart in 1971 at a conference at the University of Sussex. However there are
researchers who trace the concept of the informal economy right back to the
years of the Great Depression and the Second World War. Researchers
(Jagannathan, 1987; Portes et ai, 1989) have examined the way economies
have grown and failed over time, and how this has resulted in the formation of
the informal economy. During the industrialization process, unemployment
was high, where the supply of labour was well below its demand and this led
to people seeking other forms of employment opportunities. According to
Moser (1978) immense poverty, underemployment and unemployment in
urban areas was due to the inability of the industrialization process to absorb
large numbers of unskilled workers into the productive labour force.
2.3. TERMINOLOGY AND INTERPRETATIONS
2.3.1. Informal Economy and Informal Sector
One of the most difficult tasks is to define what the informal sector is, and to
come to a consensus on a standard definition that everyone accepts. This is
because in different societies and in different developmental perspectives
there are different interpretations on what the concept of an informal sector
means. For example, in developed countries the informal economy can be
associated with high profits, growth and development, whereas in
underdeveloped countries the informal economy may be related to survivalist
strategies and little growth.
An earlier attempt to define the concept of the informal economy reads as
follows: "The informal sector is constituted by those units and unorganized
individual workers who cannot, in the main, take advantage of the formal,
organized market for capital, inputs or outputs or other services like training.
8
Such units and individuals are forced to operate in a different market where
they have to pay significantly higher prices for whatever they purchase, be it
inputs or services, capital or even consumer goods, while receiving
significantly lower prices for whatever they sell, be it goods or services or
labour power" (Bose in Krige, 1985: 7).
Initially the term informal sector was used to describe all the activities that
were informal, however, as time progressed, it was realised that the informal
sector was narrowly defining informal activities and therefore the term informal
economy began to be used more widely. The term informal economy is
preferred over the term informal sector because it is more flexible and more
encompassing. Informal sector can include one part of the informal economy.
Over the years, the informal economy has acquired different names such as,
the unrecorded economy, peripheral sector, hidden economy, subsistence
sector, micro-enterprise economy, squatter settlements and the urban poor
(Martins and Ligthelm, 1995).
There are some common grounds with which most of these sectors align
themselves to. A common view is to distinguish between people who are self
employed and those who earn a formal wage. The self-employed people are
those belonging to the informal economy and the people that earn a formal
wage are those from the formal economy. However this conception may
cause confusion because not all people who are self employed may belong to
the informal economy, for example people in possession of their own formal
business, other self employed professionals, etc. may be self employed but
they may not necessarily belong to the informal economy. Bromley (1979)
looks at the informal economy as being unprotected whereas the formal
economy is the protected sector against a backdrop of rules and regulations
that guides it. This provides a distinction as to how the formal and the informal
economies are viewed. On the one hand the formal economy is directed by
proper policy whereas, the informal economy is plagued by an absence of
clear policy guidelines.
9
Portes et al (1989) look at the informal economy not from an individual
perspective but as a process of income generating activities that centre
around one main characteristic that, "it is unregulated by the institutions of
society, in a legal and social environment in which similar activities are
regulated" (Portes et aI, 1989: 12). This view creates a clear distinction
between the formal (regulated economy) and the informal (unregulated
economy). Many researchers argue that the concept of an informal economy
came into being because of the existence and presence of a formal economy.
However, the distinction that can be made between the formal and the
informal economy is not on what the final product turns out to be, but on the
way in which this product is produced and exchanged. In this sense the final
product can be the exact same thing produced in both economies, but the
difference is the way that this product is marketed and sold. The relationship
between the formal and the informal economy in society can be viewed as a
dualistic one. On the one hand, the informal and the formal economy can
share a symbiotic relationship whereby each can benefit from one another; on
the other hand there can be severe tension, competition and rivalry between
the sectors. "The formal sector and the informal are thus linked with each
other in an exploitative relationship through which the informal sector is forced
to subordinate itself to, and to serve, the formal sector directly and indirectly.
This has been perpetuated by the extreme lack of organization on the part of
the informal sector and the formal sector's dominant control over the state
machine" (Bose in Krige, 1985: 7). The analysis of the case study yields some
useful results which are presented in chapter four.
According to Hall and Pfeiffer (2000), the informal economy includes a range
of heterogeneous activities such as petty trade, gambling, small-scale
manufacturing and retailing, transport and security services. There are also
those illegal activities which include drug trafficking, prostitution, etc. This
heterogeneity causes difficulty for policy makers to implement and adopt rules
and regulations on a range of these diverse activities. It is widely recognized
that the informal sector are small enterprises consisting mainly of self
employed producers,and retailers or in some cases hiring workers which are
most of the time from the family. The informal sector is extremely diverse and
10
it exists in many economic sectors including trade, services, manufacturing,
construction, transport, and urban agriculture. They operate with very little or
no capital and they use very little technology and professionally trained
personnel.
An important characteristic that can be distinguished in the South African
informal sector is that between survivalist enterprises and growth or
expansion enterprises. Survivalist activities take place so as to meet the basic
needs necessary for survival, whereas growth enterprises operate so as to
achieve a profit and expand its networks. The majority of South Africa's
informal sector is dominated by survivalist activities. This form of activity exists
mainly in rural areas and in the townships where the purchasing power of
individuals are low. Growth enterprises on the other hand exist mainly in cities
where the purchasing power of individuals is much higher. Examples of this
include the informal activities in the Warwick Junction Area, West Street and
along other major intersections in the CaD of Durban. In the Durban
Metropolitan Area, both survivalist and growth enterprises can be seen to
exist together.
2.3.2. Differences between the Informal Economies in Developing and
Developed Countries
The informal economy in the international arena can be divided into two
sections, those in developing countries and those in the developed countries.
There are many examples of the informal economy in African and other third
world countries like Kenya, Mexico and Uruguay. These developing countries
display different forms and types of informal activities that are to be found in
most developing countries. The informal economies in third world countries
are attributed to traditional forms and practices; also a high emphasis is
placed on the poor quality of infrastructure. Attention is given to the notion of
rural urban migration and the informal institutions that are present there. The
informal economy in developing countries focuses on lower order goods such
as food, clothing and curios. This kind of informal economic activity applies to
11
this research. Most of the attributes of informal economies in developing
countries can be observed in Westcliff.
In developed countries like United States of America, Canada and Britain, the
informal economies are different to those that are prevalent in developing
countries, however they display a few similarities. In these advanced
countries, attention is placed on immigrants from other countries participating
in the informal economy and the problems associated with this. Immigrants
are found in large numbers in the informal economy making it difficult for the
local people to secure a place in this economy. The informal activities in
developed countries place more emphasis on the sale of higher order goods
such as computer software and arcade games. Literature reveals that there is
competition between formal and informal economies in both developed and
developing countries.
2.3.3. Street Trading in the Informal Economy
The most common activity in the informal economy is street trading. "In cities,
towns and villages throughout the world, millions of people earn their living
wholly or partly by selling a wide range of goods on the streets, sidewalks,
and other public spaces" (International Labour Organization, 2002: 7). Trading
is the exchange of goods and services either through the process of sale or
trade. With the advent of malls and departmental stores, there was a
conception that street trading would fade away. However, on the contrary,
street trading has expanded in most parts of the world. The words trading and
vending are used interchangeably in different pieces of literature, however
they mean the same thing.
Street traders sell a variety of different goods, but one of the most common
and popular goods sold are fresh produce. Witt (2000) argues that fruit and
vegetables are a good choice for street traders because it forms part of the
daily diet of most people. Street traders minimize the risk of losing out on the
fresh produce that is not sold by consuming it themselves. Trading in fresh
produce is common also because, 'start-up capital costs for traders wishing to
12
trade in fresh produce are also relatively low' (Witt, 2000: 25). There are also
those street traders who do not sell goods but instead provide a service to
their customers. These include shoe repairs, hairdressers, car washers, car
repairs and garbage pickers.
Street traders face problems with the storage of their products that they sell.
Many of them pay extra charges for overnight storage, others face the
problem of commuting with their products on a daily basis (Skinner, 2000).
The Durban Municipality has decided to address this problem by providing
storage spaces for informal traders in the Warwick junction area. The council
has realized the difficulties that traders face in commuting their goods on a
daily basis because of fear of theft. Where there are no storage spaces and
traders cannot commute their goods, they tend to reside where they sell. This
presents new problems of unhealthy and unsightly conditions. This is also
evident on the streets of the central business districts of Durban and
Johannesburg.
Street traders locate themselves along strategic transport nodes and networks
(Lund et ai, 2000). In this way, they can be in contact with a maximum amount
of people. There is an ideology of locating street traders where there are
'passing feet'. In this instance, street traders will locate where there will be a
demand for their goods and services, where there are high volumes of traffic.
Trading on the streets is often viewed as being a nuisance or obstruction to
the flow of traffic or other formal businesses. 'Up until the late1980s in South
Africa it was very difficult to get a license to trade and the laws required that
street traders relocate continuously' (Skinner, 2000: 60). During the 1970s
and 1980s, street traders were subjected to continuous harassment and
interrogation in order for them to relocate. In many cases their goods have
been confiscated and not returned, or have been destroyed. Traders were not
allowed to trade within an urban environment. Police often fined and jailed
illegal traders. However, in the late 1980s and through the 1990s, street
traders were less harassed and they now have more choice of location.
13
It is difficult to obtain official statistics for street traders because there are
many factors that hinder this process. There are inconsistencies when
counting the number of traders in a particular area because some traders
trade at different times of the year and some at different times of the day.
There are many traders who trade during particular seasons and occupy
themselves with different activities during other seasons. According to the
2000 Labour Force Survey in South Africa, there were approximately 323 000
and 23 000 food vendors and 122 000 non-food vendors. The census data for
the year 1997 recorded 19 000 street traders in the city of Durban alone.
Recognizing gender imbalances, this survey documented 61 % of street
traders in the Durban area were women while 39% were men (International
Labour Organization, 2002).
'For some, street trading may be more than merely a daily income generating
activity. Instead it allows traders to regain a sense of worth, independence,
and of contributing to the broader welfare of the community' (Witt, 2000: 40).
For many people, street trading has become a way of life, part of their social
and economic duties of living an every day lifestyle. Street trading "represents
a feature of traditional societies that has survived, adapted, or re-emerged in
modern" societies (International Labour Organization, 2002: 7).
2.4. LABOUR FLEXIBILITY
It is important to understand the working conditions that prevail in the informal
economy. Labour flexibility can be broken down into three different aspects;
flexibility of time, place and conditions. Flexibility of time looks at the different
hours and days that a person works for. This can be either part-time or full
time. In the informal economy people work irregular hours where there are no
start and finish times. Flexibility of place is where the actual work is carried
out. People can either work from home, a work place, or can be constantly
moving about as in the case of some street traders. Flexibility of conditions
looks at the kinds of contracts that people have in terms of their employment
conditions. Some workers may have a fixed contract, some may be paid by
the day and others may be paid by the hour. Contracts may be formal in
14
writing, or may be informal by word of mouth. Payment by the day is the most
common form of an informal employment contract.
Working in the informal economy involves all these aspects of labour
flexibility. Flexibility can provide the opportunity for people to work different
hours in different places during different times. At the same time flexibility can
allow people to have several different jobs in order to earn a living.
2.5. SIZE AND SCALE OF THE INFORMAL ECONOMY
The informal economy makes a very significant contribution to the national
economy of a country. However, little of its contribution has been measured
due to difficulties in recording a sector that is not registered or licensed. It is
also difficult to obtain records from the illegal activities that could take place in
the informal economy.
Looking at growth patterns of the informal economy from times of its inception,
it can be seen that considerable growth has taken place over the years. In the
early days of its development, the informal economy has made very significant
impacts to the national economy of the country. According to Preston-Whyte
and Rogerson (1991), the 1, 84 million people in the informal sector
contributed R5, 9 billion to the economy for the year 1985. This statistic was
low because it excluded the informal activities in white residential areas during
that time. In a more recent survey on the impact of the informal economy on
the creation of employment, the Durban Unicity reports that "there were about
20 000 street traders in the Durban metropolitan area and about 60% of these
were women," in the year 1996 (Durban Unicity Council, 2001: 3).
The table below provides a recent account of the size of the informal economy
in three different continents. All recent statistical data distinguishes between
employment in the agricultural and non-agricultural sector because the
agricultural sector comprises a large segment of the informal economy. It is
therefore necessary to distinguish between both these sectors. The figures in
each of these continents are fairly high because the countries that constitute
15
them are considered developing. As can be seen in table 1, more than half of
totally employed workforce in all three continents belong to the informal
economy. For Africa and Latin America the informal economy has created 93
and 83% of the new jobs respectively.
Table 1: Size of the informal economy
Latin Africa % Asia %America %
Total Employment in the InformalEconomy 66 90 90
Non Agricultural Employment 57 75 63Urban Employment 25 61 40-60New Jobs 83 93 N/a
Source: Chen, 2001 in Skinner, 2002 :13
Statistics for developed countries are less prevalent but it is widely noted that
in these countries the informal economy is also on the increase. In a
developed country such as Canada, temporary employment accounts for
nearly 10% and part-time employment for 11 % of the total employment. The
United States has 42,5% temporary employment rate and an 18% part time
employment rate in relation to the total employment in the country (Skinner,
2002). Informal activity in developed countries is not as high as that in
developing countries, but it forms a very significant part of the labour force.
Against this background, it is important to look at the progress of informal
economies over the last decade and its current trends throughout the world,
especially in South Africa.
Statistics on the informal economy in the South African context also reveals
significant levels of growth from the early days of its inception. Table 2
compares the occupations of people in the informal economy between the
years 2001 and 2002. It also shows the level of increase or decrease that took
place between these years. However, as can be seen in Table 2, there was a
drop in most of the occupational sectors between the two years, the only
sectors that has had an increase are the agricultural and fisherie workers. The
increase and decrease of the various sectors can be attributed to the
16
economic shifts that were taking place during the time. In total there were
approximately 23% of the working force that was reduced in the informal
economy.
Table 2: Informal Economy by Occupation for 2001 and 2002 in South Africa
OCCUPATION 2001 2002 INCREASE!DECREASE
Legislators, senior officials, 79000 81 000 2.5%manaQersProfessionals 25000 17000 - 32.0%
Technicians 132000 71 000 -46.2%
Clerks 42000 25000 -40.5%
Service, shop and market 625000 332000 -46.9%sale workersSkilled agricultural and 684 000 815000 19.2%fisheries workersCraft and related trade 518000 410000 -20.8%workersPlant and machine 118000 90000 -23.7%operators and assemblersElementary occupations 1091 000 717000 -34.3%
Total 3319000 2559000 -22.9%
2.6. THE INFORMAL ECONOMY IN SOUTH AFRICA
The informal economy in South Africa has been the subject of discussion from
the time the concept came into being in the 1970s. Through the past three
decades, starting from the 1970s and moving to the present situation, the
concept of the informal economy gained greater momentum and became
significantly more important as researchers and policy makers realized the
role of it's contribution to society and the economy as a whole (Skinner, 2002).
The informal economy was also growing at an unprecedented rate during the
late 1980s and early 1990s. Many writers and researchers have
conceptualized the term and wrote about it in different contexts. These include
the rural, urban, local, regional and national level contexts.
17
"The process and the profile of the informal economy are historically specific,
depending on the relationship between the state, capital and labour in each
country" (Portes, 1989 in Skinner, 2002: 15). The apartheid law has created
great imbalances in the labour market ensuring that certain jobs were
reserved for certain people. "All labour market policies were designed to
advantage big capital and white workers over their black counterparts"
(Skinner, 2002:16). Racial segregation was a major hindrance for economic
development during apartheid. "Strict licensing for all sectors of the economy
was invented to suppress the evolution of African businessmen and women"
(Wallner, 2000: 2). This contributed to the suppression of the disenfranchised
during the apartheid regime. It prevented them from building capacity and
becoming economically stable.
Under the apartheid regime, many street traders conflicted with the law.
"Historically, South Africa's informal economy has been both a potential
source of opportunity and upward mobility for some households and
individuals, and a sinkhole of exploitation for many others" (Preston-Whyte
and Rogerson, 1991: 1). In 1986 the African Council of Hawkers and Informal
Businesses was founded with the primary aim of addressing harassment and
exploitation of street traders. There were numerous attempts from various
authorities to remove them from urban areas including the city. The Group
Areas Act4 restricted non-whites from entering into urban areas, preventing
them from establishing their business.
However, since the political transition in 1994, the South African government
advocates policies of growth, integration and sustainability. In 1994 the
Reconstruction and Development Programme (RDP)5 guided the state to
provide and ensure that the needs of the poor be addressed, including that of
the informal economy. In 1995 the government gazetted a strategy to support
Small Medium and Micro-enterprises in the White Paper (Durban Unicity
Council, 2001). 'The government identifies four categories - medium
4 Act 36 of 1966 enshrined in the constitution during that time.S The RDP was a socialist (addressing the imbalances of the past) document that guided the
government's social and economic activities directly after the transition in 1994.
18
enterprises, small enterprises, micro enterprises and survivalist enterprises. It
outlines concrete proposals with respect to all categories except survivalists"
(Skinner, 2002:17). In 1996 the Growth Employment and Redistribution
(GEAR)6 policy created a forum where South Africa became a global player in
the world. With privatization and trade liberalization, companies were
restructuring resulting in formal employment opportunities decreasing.
Employment was shifting from formal to more flexible forms. People in search
of income looked at alternate ways of making a living. Thus the informal
economy began increasing rapidly.
''The range of informal employment activities recorded in South African
literature is extensive" (Preston-Whyte and Rogerson, 1991). South Africa has
numerous informal economic activities that are in existence. These activities
range from shoe shiners to pirate taxi drivers to sheeben-owners. Street
trading is the most common form of informal activity in the informal economy
throughout the world including South Africa.
Literature on the informal economy in South Africa focuses on government
policy and regulation, management tools and the different problems faced by
this sector. There are also various case studies (Skinner, 1999, Witt, 2000
and Durban Unicity Council, 2001) that have been investigated such as the
Warwick Avenue and the Durban beachfront. These are of relevance to the
research where findings from the various case studies has been drawn upon
so as to reflect on this research.
2.7. RELATIONSHIP BETWEEN FORMAL AND INFORMAL ECONOMIES
According to Hall and Pfeiffer (2000), the informal economy can never be
classified as being totally informal because activities that may start of as being
informal can become formal over time. The opposite is also true, where
activities that may be formal in the beginning, can end up as becoming
informal. "The formal and informal parts of the economy are mutually
6 GEAR was the policy that followed from the RDP in 1996. It proposed liberalization and freemarket policies.
19
interdependent. The good health of one depends on the good health of the
other" (Durban Unicity Council, 2001: 3). The formal sector can provide
support and opportunities for growth and development of the informal sector.
On the other hand they can also act as capitalist structures whereby they
dominate and exploit the informal sector as argued by the Marxist theorists.
Rogerson (1996) argues that the demise of the formal economy results in a
greater number of participants in the informal sector. He also looks at the
informalisation of the formal economy. This view suggests the co-existence of
both these economies, whereby they can supplement each other.
"Many workers in the lower segment of the formal sector have as little job
security as informal sector workers and receive even smaller wages, and this
causes people to move gradually from the informal to the formal sector" (Hall
and Pfeiffer, 2000: 72). There are also those workers who have lost their
formal jobs, tend to seek employment in the informal sector. Many new
comers into the labour market are forced into the informal economy because
of the difficulty to find formal jobs. With the world population increasing,
competition rises and this creates pressure on formal employment, and makes
entry into the formal labour market harder as time progress.
From Table 3, it is evident that the informal sector is on the increase as
recorded from the year 1997 to the year 2001. Over the years the number of
people in the informal sector began to increase significantly. However, if one
looks at the trends in the formal sector, it is evident that the numbers have
stagnated during this period notwithstanding population growth7. The table
also reflects that the unemployment rate is drastically increasing.
7 Although the population was increasing leading to more people beginning to enter the labour marketthe trend in the formal sector employment remained the same during this period. '
20
Table 3: Formal and Informal Economy Labour Market Trends, 1997-2001
LFS Sep LFS Sep
OHS 1997 OHS 1998 OHS 1999 2000 2001
Formal 6,405,953 6,527,120 6,812,647 6,841,877 6,872,924
Commercialagriculture
495,530 726,249 804,034 666,940 665,941
Subsistence163,422 202,290 286,856 964,837 358,983agriculture
Informal
965,669 1,077,017 1,573,986 1,933,675 1,873,136DomesticWork
992,341 749,303 798,524 999,438 915,831Unspecified
70,986 107,966 92,905 305,797 146,000Totalemployed
9,093,901 9,389,946 10,368,951 11,712,565 10,832,816Unemployed
2,450,738 3,162,662 3,157,605 4,082,248 4,525,309Not ecoactive
13,960,772 13,156,940 12,752,967 11,100,135 12,006,413Total notemployed
16,411,510 16,319,602 15,910,572 15,182,383 16,531,722Total Pop,
25,505,411 25,709,548 26,279,523 26,894,948 27,364,538age 15-65
Source: Devey, Skinner and Valodia, 2002(LHS) refers to the Labour Force Survey (2000-2001) used by Statistics South Africa tocollect data.
(OHS) refers to the October Household Survey (1997-2001) used by Statistics SouthAfrica to collect data.
Rogerson (1996) argues that the formal economy is finding it increasinglydifficult to absorb new entrants into the labour markets. The formal economygoes through long periods of recession and this affects the labour markets inboth the formal and informal sectors. As a result of this recession, manypeople are retrenched. Those people who are unemployed in the formal
21
sector tend to look for solutions in the informal sector. The informal sector
therefore constitutes people not only from the rural areas but also those who
are stable residents in urban areas. After serious economic crisis in the formal
economy, many people are forced to earn a living in the informal sector. As
mentioned above, an important link that occurs between both sectors is the
informalisation of the formal economy. This is a mechanism that allows many
of the formal sector jobs to be contracted out to the informal sector. In this
way the formal economy can bypass the rules and regulations that are
subjected to it in normal circumstances. It can thus exploit labour in the
informal sector. For example in the clothing sector, much of the production is
out-sourced or contracted out where labour is cheap and formal employment
contracts do not have to be signed.
There are those people who enter the informal economy out of choice and not
a consequence of it being a last resort for them. Most employment in the
formal economy requires one or more of the following, formal education, skills,
resources and experience. The informal economy on the other hand, requires
little or no education, skills, resources or experience. This makes it much
easier for people to do informal work. A common view is that the informal
economy is an easy way out for people trying to escape the requirements
needed for the formal economy. Subsequently, engagement in the informal
sector is perceived as being suitable for those from the lower rungs of society
compared to those in formal employment. In Westcliff there are many
successful people that have chosen to enter the informal economy out of
choice and not as a consequence of it being a last resort.
Table 4. provides statistics for the different occupational categories present in
the formal and informal economies in South Africa. As can be seen,
occupations that require high levels of skill (management, professional and
technical positions) are dominated by people in the formal economy. Those
occupations that require semi-skilled (craft and shop workers) and unskilled
work (elementary occupations) are dominated by people in the informal
economy (Devey, Skinner and Valodia, 2002).
22
Table 4: Number and Percentage Formal and Informal Workers, byoccupation in South Africa.
Formal Informal Formal Informal
Management 580,914 63,307 8.5% 3.4%
Professionals 460,214 20,016 6.7% 1.1%
Technical 1,043,003 91,121 15.2% 4.9%
Clerks 1,047,452 32,793 15.3% 1.8%
Service and shop workers 991,052 378,527 14.4% 20.2%
Skilled agriculture 50,637 128,593 0.7% 6.9%
Craft related occupations 911,351 478,310 13.3% 25.6%
Plant and mechanicaloperators 876,472 87,312 12.8% 4.7%
Elementary occupations 900,577 590,416 13.1% 31.6%
Total 6,861,672 1,870,395 100.0% 100.0%
Source: Devey, Skinner and Valodia, 2002
In most cases, the formal sector exploits the resources in the informaleconomy. It is apparent that the informal sector is marginalized in terms ofresource allocation and support. Therefore, assistance and guidelines toensure its growth and success, is not forthcoming. A common reason for thisis that many informal sectors have no representative structures to voice theirconcerns and problems. People in the informal economy do not express theiropinions, for fear of being prosecuted by the law. Unlike the other provinces inSouth Africa, the eThekweni Municipality in KwaZulu-Natal has takenproactive steps in implementing proactive policies to assist informal workerswith improving their conditions and status.
The majority of the formal sector in the economy regards the informaleconomy as being illegal because of the unregulated manner in which itoperates. Small formal businesses complain because the informal economycompetes directly with them. They argue that the informal economy is notsubjected to tax and rent, and this creates a comparative advantage for
23
informal businesses. There are also many cases where the informal economy
sell and trade goods cheaper than that of the formal sector. In the case of
Westcliff, there are formal businesses located next to the informal sector and
they trade similar goods. This point will be further explored in chapter four.
2.8. GENDER DISCRIMINATION IN THE INFORMAL ECONOMY
There are extensive bodies of literature worldwide focusing on the issues of
gender in the informal economy (Skinner, 1999 and Lund et ai, 1999). The
issues relate to the conditions that women face and the policy options that are
available to assist them. The literature depicts the types of jobs these women
are in, in relation to those that men occupy. South African literature provides
statistics and the breakdown of women in the different parts of the informal
economy (Skinner, 1999).
"It is now well documented that worldwide more women than men participate
in the informal economy" (Skinner, 2000: 58). The representations of women
together with their economic contributions are underestimated in statistics
because a lot of activities that are carried out by them are difficult to record or
are not recorded at all. Trading in the informal economy is a challenge, but it
is an even bigger challenge if you are a women not equipped with the
necessary skills, training and education. Table 5. indicates that men earn
significantly more than women in the informal sector. As can be seen, higher
up in the income ladder women earn half as much as their male counterparts,
but they dominate at the lower rung of income earnings.
24
Table 5: Earnings of informal economy workers
Male Female
None 3.8% 7.5%
R1-200 12.2% 27.2%
R201-500 24.6% 28.3%
R501-1 000 23.9% 19.3%
R1 001-1 500 11.3% 6.3%
R1 501-2500 11.7% 5.1%
R2 501-4 500 7.7% 4.1%
R4 501-11 000 4.1% 1.8%
R11 001+ 0.7% 0.3%
Total 100.0% 100.0%
Source: Devey, Skinner and Valodia. 2002
Women are generally more prone to poverty and unemployment and this
makes them vulnerable to accept jobs in the informal economy that subject
them to exploitation and harsh working conditions. "Gender segregation in the
informal sector means that women and men are involved in different types of
activities or different employment statuses even within the same trades"
(Sethuraman and Charmes, 1998). Women carry out smaller scale activities
that are less profitable than their male counterparts. "Male traders are more
likely to have larger scale operations and deal in non-food items, while female
traders tend to have smaller scale operations and deal in food items. The
former being more lucrative than the other" (Skinner, 2000: 59).
Table 6 below distinguishes between the various occupations in the informal
economy by gender. It is clearly evident that men are more represented in
higher forms of employment than their female counterparts (less than a third
of females are in management positions than males). Women are found more
in the service related occupations and the unskilled elementary occupations,
while men dominate as operators.
25
Table 6: Proportion of Occupations in the Informal Economy, by Gender
Male Female Total
Management 78.0% 22.0% 100.0%
Professionals 48.1% 51.9% 100.0%
Technical 49.2% 50.8% 100.0%
Clerks 34.0% 66.0% 100.0%
Service and shop workers 34.7% 65.3% 100.0%
Skilled agriculture 93.7% 6.3% 100.0%
Craft related occupations 75.0% 25.0% 100.0%
Operators 87.1% 12.9% 100.0%
Elementary occupations 36.7% 63.3% 100.0%
Total 54.4% 45.6% 100.0%
Source: Devey, Skinner and Valodia, 2002
2.9. LOCAL ECONOMIC DEVELOPMENT
Local economic development (LED) develops a specific area in terms of
economic growth. This development will take place if LED policies and
principles are being practiced in an area. LED can be applied in areas where
there are high levels of poverty, low levels of economic and social growth, and
also in areas where small businesses are thriving, be they formal or informal.
LED policies can therefore be perfect tools that can be used to assist the
informal economy and to bring about growth in this sector (Nel, Hill and
Elsing, 2002).
"Key however to the long term future of the area and its residents is the need
to ensure that a sustainable economic base is created to ensure the economic
well-being of residents and generate funds to finance future social and other
programmes" (Nel, Hill and Elsing, 2002).
26
The above can be applied to the informal economy in Westcliff. The informal
market in this area has to build a strong economic base and if this is created,
then the future social and economic conditions will be much improved than
they presently are. LED can develop a holistic, sustainable, quality urban
environment, in a manner that leads to the generation and redistribution of
economic opportunities, builds local capacity and improves the standard of the
poor (Nel, Hill and Elsing, 2002). If LED were to be applied in Westcliff, the
long-term vision would be to create and develop skills, jobs, higher incomes
and sustainability within these sectors and thereby developing the area
holistically.
2.10. POLICY AND LEGISLATIVE CONTROLS TOWARDS THEINFORMAL SECTOR
In the same way that the informal economy has many different facets, so too
are policies designed to manage and control activities in this sector. This
implies that no single policy can exist in isolation. Policy makers must be
sensitive when applying policies and regulations towards the informal
economy.
It is important to distinguish between survivalist strategies and growth
enterprises so that the right policy can be channelled to the right sector. As
has been established, growth enterprises exist to make a profit whereas
survivalist enterprises operate to make a living. Policy can therefore provide a
framework that encourages and promotes higher levels of expansion in the
growth enterprises, and can provide a coherent framework that allows
survivalists enterprises to develop and become more competitive.
It is difficult for those who are enacting policy to decide whether the activities
in the informal sector should be regulated or not. The South African
government has placed much emphasis on the informal sector. The South
African Constitution mandates local governments to promote economic
development (Durban Unicity Council, 2001). Through the Reconstruction and
Development Programme (RDP) the growth of the informal sector was
27
considered important in boosting the countries economic and social
conditions.
There are currently two pieces of legislation governing street traders in South
Africa. These are the Business Act 71 of 1991 and the Municipal Notice 96 of
1995. These two acts provide the context which allows the informal economy
specifically street trading within each province to be regulated and managed.
The Unicity of Durban has taken a proactive and progressive developmental
approach to the informal economy in the Durban and surrounding area. This
can be seen by the informal economy policy developed by the Durban Unicity.
Often policy makers have to decide on whether to protect the needs of the
local authorities and the formal economy or, to provide support for the
development of the informal economy. Local authorities argue that their job is
to keep urban areas aesthetically clean and attractive to all its users (Beavon,
1989). Local authorities must prevent hawkers and other traders from blocking
the pavements and streets or it will result in increasing levels of traffic. By
doing this, the informal sector argue that policy makers favour the formal
markets over theirs.
There are very few South African cities that have passed the stage of
deregulation (Rogerson, 1996). Much of the formal sector argues that the
informal sector should be regulated and licensed so that they can operate
smoothly, and much of its illegal activities can be stopped. In South Africa and
other parts of the world, informal activities occur where there is a demand for
their market. As a result, there are high levels of congestion and unfavourable
working conditions. The informal sector should be regulated but not in a
manner that would hinder its growth or result in its demise. Caution must be
applied when regulating this sector.
2.11. CONCLUSION
Conclusion gleaned from statistics presented in this chapter, indicates that the
informal economy has made significant contributions to the Gross Domestic
28
Product (GDP) of South Africa. It can also be seen that there are a significant
number of workers that are active in the informal sector who are contributing
to the economy of the country. Through this, the informal sector can boost the
economic conditions of a country. In South Africa and other developing
countries, the informal sector provides for millions of people wanting to meet
their basic needs for survival. It also provides for those wishing to expand their
existing business.
"However, to date, few policy makers have explicitly addressed the
opportunities and constraints faced by informal producers/workers in the
context of global integration and competition" (Carr and Chen, 2002:1). The
informal sector is already an influential sector in the economy, hence policies
have to be well structured in order to formalise and control activities. These
policies need to distinguish between growth and survivalist enterprises and
need to focus on issues of gender inequality and constraints within the
informal economy.
29
CHAPTER THREE
METHODOLOGY
3.1. INTRODUCTION
This chapter describes the study site and details the various ways in which
data was collected. The chapter concludes by reporting on constraints and
limitations that were encountered in the field.
3.2. LOCATION OF THE CASE STUDY
The area under investigation is the Bangladesh Market within the residential
area of Westcliff located in the suburb of Chatsworth, Durban. As can be seen
in Map 1, Chatsworth is located in South Central Local Council of the greater
Durban Metropolitan area. The area lies approximately 25 kilometers south of
the city of Durban. This area has direct access routes north leading towards
the Durban's CBD and South towards the industrial areas of Clairwood and
Mobeni. Surrounding Chatsworth are the residential areas of Queensburgh,
Malvern, Shallcross, Yellowood Park, Umlazi and Lamontville. ''The area is
characterized by undulating topography which affects planning of the town,
creating steep road verges affecting access to properties and road side
parking and it also places restrictions on the citing of certain types of
activities" (Naidoo, 1999: 38).
Map 2 presents all the units in Chatsworth. As can be seen, Westcliff is
approximately at the centre of the area east of the Town centre. The Town
centre is where the major shopping complex is situated. All units are linked to
one another by a good transport system.
Map 3 displays an aerial view of the Westcliff Business Centre within which
the Bangladesh Market is situated flanked by formal businesses and the
surrounding residential area.
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3.3. METHODOLOGY
The research methodology used both primary and secondary sources.
3.3.1. Secondary Material:
This part of the study entailed a literature review of the informal economy in
general and the way it operates in South Africa and Durban in particular.
Newspaper articles and research done on informal work in the Durban
Metropolitan region has been examined. The eThekweni Municipality Policy
on informal traders, case-studies and pilot projects for different areas were
also referred to. Minutes of meetings, circulars, notices and other printed
material relating to the Bangladesh informal market were examined. The
purpose of this was to set up a conceptual and contextual framework for the
study.
3.3.2. Primary material:
3.3.2.1. Interviews
At the outset five categories of stakeholders were identified by on site visits
and discussion with members of the Bangladesh Market Association, these
include:
~ The informal traders from the Bangladesh Market
~ Members of the Bangladesh Market Association and member from the
Council including planners, officials and politicians
~ The surrounding residents of the Market
~ The surrounding businesses of the Market
~ The clientele/customers of the Market
A separate interview schedule was designed for each category (refer to
Appendices 1 to 5).
34
I
The structure of interviews was as follows:
In-depth interviews were carried out with ten informal traders, cognisance was
taken of gender and age when selecting respondents to ensure equity and a
more inclusive viewpoint. Semi-structured interview schedules8 were used.
This rendered the interviews neither static nor uniform allowing the researcher
to be both flexible and systematic when addressing the research questions
(Do Rego, 1995). This enabled the researcher to gain access to more
information by probing questions and responses in order to stimulate
discussions.
Two key members from the Bangladesh Market Association were interviewed,
the president and a representative member from the disadvantaged (African)
trader category. A semi structured interview schedule9 was used. Twenty-five
residents surrounding the informal trading area were interviewed, employing
the stratified sampling method of selection. These were in-depth interviews
using structured questionnaires10. Fifteen semi-structured interviews11 were
carried out with the formal businesses surrounding and adjacent to the Market
area. A semi-structured interview schedule12 was executed with twenty five
customers of the informal market.
3.3.2.2. Sampling Technique
Due to time and research constraints the sizes of each sample were smaller
than the researcher initially planned. However it was considered important
from a methodological perspective to interview people in all of the stakeholder
categories described above. In order to get a variety of respondents in the
questionnaires for the informal traders, a stratified sampling technique was
used because there are people selling different products like vegetables,
chicken, clothing, curios and jewellery. A stratified sampling technique in this
8 Refer to appendix number 19 Refer to appendix number 210 Refer to appendix number 311 Refer to appendix number 412 Refer to appendix number 5
35
..
way allowed the researcher to obtain an equal number of respondents from
the different categories that were present. ''The ultimate function of
stratification is to organize the population into homogenous subsets (with
heterogeneity between subsets) and to select the appropriate number of
elements from each" (Babbie and Mouton, 2001: 191).
For the twenty-five residents, the researcher employed a systematic sampling
method. The Bangladesh Market is enclosed on three sides by residential
houses and on one side by residential flats. The stratified sampling method
allowed the researcher to select an equal number of houses on the three
sides of the residential area as well as providing a representative sample of
the residents. The method that was used for selecting homes was to interview
all the front line houses in relation to the Market into the sampling frame. This
proved to be more effective because those houses that are closest to the
Market have been most affected by the Market activities.
The twenty-five customers were randomly chosen and interviewed at the two
main entrances of the Market. Customers were chosen after they had visited
the Market and purchased goods because some of the questions related to
the goods that were bought on that day.
The criteria used for selecting the formal businesses were those businesses
that traded similar goods to that being sold in the informal market. These
formal businesses are in very close proximity to the informal market. Before
the actual fieldwork was conducted, the researcher interacted with many of
the formal businesses and observed that they had been affected by the
informal market either in a positive or negative manner. It was also noticed by
the researcher, prior to the commencement of fieldwork, that many of the
clientele supported the informal market instead of the formal businesses on
the weekends. These factors motivated the researcher to investigate the
relationship between these two sectors existing side by side.
36
3.3.2.3. Interview process
The units of analysis are; the Market, the dynamics surrounding informal
traders as well as the adjacent formal businesses and residential areas. Data
collection entailed travelling to the study area on a weekly basis since the
Market only operates twice a week (Fridays and Saturdays). The interviewer
established contact with the interviewees by introducing the case study and
highlighting the purpose of the study, also by suggesting that the research
could have a positive impact on their trading activities. This created a
comfortable atmosphere in which questions were asked. The five different
types of interviews that were conducted had different time durations, ranging
from twenty minutes to one hour forty minutes.
3.3.2.4. Participant Observation
This took the form of observing what happens and when it happens, for
example the busy and quiet times of traders, who are the clients and what are
the contributing factors to the operation of this market. The researcher
interacted with traders in the capacity of a customer, which revealed
interesting marketing strategies and dynamics.
The researcher visited the Bangladesh Market several times in order to
execute fieldwork. The researcher was at the market on Fridays and
Saturdays during all parts of the day. This allowed the researcher to gain
insight on the dynamics of informal trading at the market.
3.4. CONSTRAINTS AND LIMITATIONS
Although the field-work has yielded some very interesting information on the
dynamics of informal trading in the Bangladesh Market, there were limitations
and constraints that were encountered during the course of the study.
Travelling to the site twice a week for six weeks was time consuming and
costly.
37
Some of the traders were hesitant to disclose all the information needed
fearing discrimination although confidentiality was ensured at the outset by the
researcher. Traders were also busy serving customers and this made it
difficult for the researcher to carry out the interviews with them.
The study was conducted in the confines of informal trading in the Market and
in the car park surrounding the Market. The research may therefore be limited
to be analysed in terms of these boundaries.
Key respondents such as the two members from the Bangladesh Association
Board were difficult to reach. One of the key respondents often cancelled
appointments. One of these respondents was a full time employee engaging
in market issues on a part-time basis, whilst the other board member, who
was a street trader, provided very useful information, as her perspective was
critical of market dynamics, which often posed as an obstacle to her business.
3.5. CONCLUSION
This chapter provides an understanding of how research has been carried out
in the study and it details the study area. Although there were constraints and
limitations, the prescribed methodology has yielded some interesting results.
These results proved to be very useful and it shall be analysed in the next
chapter.
38
CHAPTER 4
ANALYISIS OF INFORMAL TRADING IN THE
BANGLADESH MARKET
4.1. INTRODUCTION
In this chapter a detailed analysis of the trends and dynamics of the informal
trading sector in the Bangladesh Market are recorded. This analysis includes
the activities of all stakeholders in the Bangladesh Market namely the traders,
the formal businesses, the surrounding residents, the clientele of the Market
and members of the Bangladesh Market Association.
4.2. THE BANGLADESH MARKET ASSOCIATION
4.2.1. Members of the Association
Respondents were members on the Board of the Bangladesh Market
Association. These respondents were always engaged in activities in the
Market place. The key interview was carried out with the Chairman of the
Association who is a principal at a nearby high school. He is the only member
that does not trade in the Bangladesh Market. He has been involved with the
establishment and development of the Market from its inception in 1984.
Eighty percent of the respondents were traders from the Bangladesh Market.
Traders across the race groups were selected.
39
Bangladesh Market AssociationBoard of Trustees
Representativestall holdersfrom the legalmarket (8)
Representativefresh produceretailers from thelegal market (2)
Representativeunderprivileged(African) stallholder (1)
11 Members
FIGURE 1: AN ORGANOGRAM OF THE BANGLADESH MARKET AND ITSSTATUTORY BODY
4.2.2. Establishment of the Bangladesh Market and the BangladeshMarket Association
The Bangladesh Market Association is made up of a Board of Trusteesthat comprises eleven members as can be seen in Figure 1. The members ofthe board are elected by stall-holders on a bi-annual basis. This board oftrustees represents all the stallholders in the formal vending area. However,when engaging with the city council, the "legal" market vendors of theAssociation, the Poultry Vendors Association and the pavement Traderscombine to form one united body. In this way they have greater strength inlarger numbers. There is a dualistic relationship between the City Council andthe Bangladesh Market Association. They work jointly to bring aboutdevelopment to the Market area. The Board holds four meetings per annum,one in every quarter. There is no official legal representative for the Board.
40
Attendance of traders at meetings are irregular, hence their contribution is not
significant due to low attendance at meetings.
Bangladesh Market Association was established in 1984. Initially traders were
car-park traders at the Shopping Centre which is now adjacent to the Market
place, situated on Florence Nightingale Drive13. As have been established
earlier, it was illegal to trade in the city and residential areas because of
apartheid policies. It was a mechanism by the government to undermine all
black entrepreneurs. The street traders of this area were continuously being
harassed and their goods were often confiscated by the police and given to
them a day or two later. These were perishable goods so they were often
damaged and could not be sold after it was returned to the traders.
Noticing the intensity and the extent of the problem, a few concerned
members approached the City Council requesting an area for traders to be
designated. At that time the Council's undemocratic approach did not respond
to the trader's request. However, members of the public and traders persisted
with trade in the area where the formal shopping complexes are currently
situated. They took the initiative and began to clear a vacant plot where they
started to trade without any assistance from the Council. In 1984 there were
approximately 100 traders who met and decided to form the Association. In
1987 the Association grew and its members began to make improvements to
the Market area, for example, the area was tarred at the trader's cost.
The interest group, comprising 100 members, began to negotiate with the City
Council and a formal lease agreement was entered into with the Council for
the area which was to be occupied by the traders. Traders were given
recognition and the space allocated for the Market now accommodated forty
stalls. As time elapsed, the demand for trading in the area grew. In 1995 the
number of stalls rose to three hundred and thirty. In order to be racially
inclusive and empower the disadvantaged, the Indian street traders who were
the pioneers of the Market decided to include seventy to eighty Black street
13 Refer to aerial photo Map 3
41
traders as members of the Association, where they were given spaces to
trade in the Market. This encouraged disadvantaged groups to engage in
market activity which was a livelihood for them.
Traders came from all parts of KwaZulu-Natal, constituting mainly Indian
farmers and retailers who offered competitive prices and quality produce. By
1995 the Bangladesh Market became a lucrative business for those trading
there. Subsequently the number of traders increased to five hundred and
sixty. The announcement of the construction of a formal market structure was
well received, as it was hope for those in need of a means for survival. The
number of traders began to swell as they started to occupy the roadside
leading to the Market together with the parking area with the hope that they
will be allocated space in the new market structures.
The negotiation for the new formal market structure provides the traders with
two options. The first as suggested by the Council is a partnership with the
private sector, but this could create problems for the traders if they cannot
afford to pay their bills for example, the monthly rentals. The second option is
for those traders who are financially independent allowing them to enter into a
contract with the Council who will subsidise part of the development. The
other part of the funding is to come from the Bangladesh Market Association
and jointly they will construct the Market structure to house about seven
hundred and fifty traders.
4.2.3. Vendors at the Bangladesh Market
The Bangladesh Market area currently constitutes formal traders within the
designated market ground, the road traders who are members of their own
Association and lastly the car boot traders. At the moment there is an overflow
of pavement and illegal traders who congest the parking area. As a result of
this, the road leading to the Market is closed to vehicles on Fridays and
Saturdays. Also during peak hours there is no parking in the car park due to
the lack of space that is occupied by the illegal traders. Recently, Council
served the car boot traders with an eviction notice, which was withdrawn as
42
intervention from politicians allowed them liberty to trade until after theChristmas season. The car boot traders pose a further problem as the Marketcustomers patronize those most accessible to them. Hence, the stall-holderswho are paying tenants, complained that they lose out on trade, becausepeople shopped outside for convenience.
Traders and market officials claim that Bangladesh is the most viablemarketplace for business, attracting traders from all parts of KwaZulu-Natal. Itis also very profitable for the traders and the prices are fairly competitive forthe consumers. Traders from outside the Durban region travel by taxi and theyreside overnight within the Market area. They rent rooms within the vicinity toprevent them from travelling after trading hours. The surrounding residentswelcome the income from the traders.
4.2.4. Monthly Income, Expenses and Expenditure
The Chairman of Bangladesh Association indicated that all administrativeduties were carried out by members on a voluntary basis. Only the Treasureris awarded an honorarium. The accounting duties have been assigned tosenior school pupils overseen by a specialist teacher at the school as well asthe Chairman. The financial records are audited by a registered auditingcompany annually. The Association boasts a credit balance with investmentsthat generate an income for the Association. The rent which is collected by theofficials of the Association from stall-holders is invested after expenses formaintaining the market place. This accrues interests.
The primary source of income for the Bangladesh Association is marketrentals which began at SOc per stall in 1987. This was increased many yearslater to R10 per stall, which is what traders are currently paying. Rents areuniform across the board irrespective of the product being traded. TheChairman indicated that the books have never reflected any bad debts andthat the Bangladesh Association is the most financially sound marketassociation in KwaZulu-Natal (KZN). The chairman drew attention to the R6, 2million market project which was constructed in Arena Park a neighbouring
43
unit, by the council. This is a "white elephant" lying vacant for some six yearsnow due to lack of support by the traders. The main reason for this was thatthe traders could not afford the rent demanded by council. Hence, theypreferred to trade on the street or under informal shelters. Therefore, theBangladesh Association proposed a low-cost basic structure which willprovide the necessary space and protection from inclement weather, for thenew market so that it remains affordable for traders and consumers tocontinue supporting.
The costs of maintaining the Market premises are approximately R6 000 amonth. This includes water, electricity, refuse removal and general cleaning ofthe Market area. Whilst traders enjoy all these facilities they are constantlyand understandably complaining of shelter which inhibits trade in inclementweather. The Board's view is that the new market structure will alleviate thatproblem.
4.3. COMMODITY IN THE INFORMAL TRADE-BANGLADESH MARKET
"Although street traders sell a variety of goods one of the more popularproducts sold is fresh produce... , trading in fresh produce is probably the mostrational choice for informal traders" (Witt, 2000: 1). The array of goods that arebeing sold in the Bangladesh Market are diverse. The main commodities thatare being traded are vegetables and fruits. From observation and interviewscarried out it is clear that about 70% of the stall holders sell vegetables andfruits. The other 30% of stall holders deal with a wide assortment of items.These include groceries, cosmetics, fish, chicken, food and beverages, prayergoods, clothing, flowers, brassware, crockery, compact discs and cassettes.The organogram below shows the composition of all the traders in theBangladesh Market irrespective of them being 'legal' or 'illegal', together withthe goods that they sell.
The legal traders in the Bangladesh Market are those traders that sell theirgoods in the designated space provided for the traders. These traders are allmembers of the Bangladesh Market Association. The illegal traders are those
44
traders that sell in the car park area and are referred to as the car boot
traders. Those traders that sell on the road leading to the Market are referred
to as the pavement traders are also considered illegal traders. However, the
poultry traders that sell on the road are the legal traders. They have been
granted rights to sell on the road because of the large space that they require
and also because of the unhygienic conditions that they create. Both the legal
and the illegal traders are informal because they both do not pay taxes to the
government.
45
Picture 1
This picture shows the most common commodity that is sold at the
Bangladesh Market namely vegetables.
Picture 2
Picture 2 shows the variety of cosmetics and curios that is sold at the marketplace.
46
Picture 3
Picture 3. presents a chicken trader from the car park area.
Picture 4
Picture 4. shows those traders that sell smaller commodities in order to make
living. These traders cannot afford the fees for hiring tables neither can they
afford to buy their own Gazeboes.
47
Picture 5
Picture 5. illustrates the proximity of residential flats neighbouring the Market.
An exit has been provided for residents on the north wing of the Market.
Picture 6
Picture 6. is an illustration of the difficult conditions under which traders
operate. Inclement weather like wind and storms destroy their structures and
often prevents them from erecting it.
48
Picture 7
This is a picture of the entrance to the Market. It depicts the congestion during
peak hours. However, the congestion gets worse during later hours of the day.
It also highlights the proximity of residences and the inconvenience residents
experience due to market activities on Fridays and Saturdays.
Picture 8
This a picture of an poultry trader who engages in illegal and unhygienic and
foul smelling activity of poultry cleaning on the pavement along the Market.
Residents and customers complain profusely, ironically she still has a market
for her trade. They support her by purchasing cleaned poultry.
49
Picture 9
The background scene depicts the formal trading area which is almost
merged with the parking area and the car-boot trading activities.
Picture 10
The above picture depicts a large chain store which is adjacent to the
Bangladesh Market. On the pavement are the 'illegal' pavement traders who
capitalise on the location hoping to attract costumers who are visiting the
chain-store and the Bangladesh Market which is located to the right of the
Picture.
50
Picture 11
This picture shows the parking lot opposite the Market. It is evident that whilst
the space is not enough for costumers visiting the Market area it is congested
further by the activities of the car-boot traders as seen above (green tent). It
also captured the activity of the car-guard who operates there on trading days.
Picture 12
This picture is the view of the street leading to the Bangladesh Market. It is
flanked by pavement traders with their gazeboes, restricting the flow of traffic.
Traders complain that such congestion constrains the transporting of their
goods to and from the Market place.
51
"Legal and illegal"
PavementTraders
"Legal"
DesignatedFormal Market
Fresh produce, groceries,
cosmetics, fish, chicken, food
and beverages, prayer goods,
clothing, flowers, brassware,
crockery, compact discs and
cassettes.
"illegal"
Car BootTraders
Fresh produce, fastfoods, clothing,cosmetics, audiovisual compact discsand cassettes.
Clothing, freshproduce, householdwares, artifacts.
Figure 2: COMPOSITION OF THE BANGLADESH MARKET
Table 7: The number and composition of traders in the Market
TYPE OF TRADERS NUMBERS
Legal Market Traders 330
Legal Pavement Traders 30
Pavement Traders 120
Car Boot Traders 80
Total 560
The above figures have been obtained from the chairman of the Bangladesh Association (05111/03).The numbers for the pavement traders and the car boot traders have been estimated by the researcher.
52
4.4. TRADERS
The respondents of primary importance were the traders. The traders interviewed
include males and females who trade at the Market on a weekly basis. They are
often referred to in this study as stall-holders. They are engaged in the sale of
various goods both perishable and non-perishable. Figure 2 provides a
composition of the traders (both legal and illegal) together with the goods that
they sell. Table 7 gives the number of traders in each category. A representative
sample was taken and traders from all categories were interviewed.
4.4.1. Profile of the Traders
It was interesting to note the life histories of traders. This formed a major part of
the researcher's analysis as the key area of interest was the purpose of engaging
in this type of activity. The findings reveal that for most traders this was the only
means of survival. The respondents are traders ranging from teenagers, middle
aged adults as well as older people between ages 50 and 60 years. Classifying
traders into racial grouping from the researcher's observation at the Bangladesh
Market reveals that approximately 90% of traders were "Indians" and 10%
"African".
4.4.2. Supply, Suppliers and Reliability
The links and distributional chains within the informal market are evident. Traders
source their goods from a variety of different suppliers. Suppliers also depend on
the types of goods that are being sold by the trader.
The traders that are selling fruit and vegetables have specific suppliers from
whom they obtain their goods on a regular basis. Most of these traders purchase
their goods from the Clairwood market which is approximately ten kilometres
away from the Bangladesh Market. "The Clairwood Fresh Produce Market is the
53
key link in the fresh produce distribution network in the Durban Metropolitan Area
and the province as a whole. Fresh produce is sourced countrywide before being
redistributed through various channels, including the 'informal' economy" (Witt,
2000:9). Traders complain that they have to go to Clairwood market very early in
the morning in order to obtain the fresh produce direct from the farmers. If they
are late, they have to purchase the goods through a secondary link which is more
expensive. The suppliers and the supplies at the Clairwood market are reliable
according to the traders.
Approximately 30% of the respondents stated that they obtain their goods direct
from the farmers. These traders travel to farms as far as Camperdown and
Richmond in order to purchase their goods. They prefer this method of obtaining
their goods as it is cheaper, the produce is fresher and the supplier is more
reliable. Only a few traders stated that they plant their own produce to sell.
Approximately 20% of the respondents stated that they buy the goods from
farmers within the Market. These stallholders sell smaller quantities of fruit and
vegetables, where their profits are smaller. Farmers have been strategically
selected to trade in the Market so that they can dictate and control the prices of
fresh produce and the quality of products that are being sold there. In this way
the other traders cannot exploit the customers of the Market. These farmers have
been allocated between fifteen to twenty stalls in the Market. It was argued that
the farmers maximize profits at the expense of consumers and other traders.
However, their prices are still very competitive and it serves as a 'draw card' for
consumers who are attracted to the Bangladesh Market from across the
province.
Those traders selling other items such as cosmetics, clothing, crockery and
plastic ware obtain their goods from an array of different suppliers. These traders
seek the cheapest rate when purchasing their goods. Some of the outlets that
were listed are factory shops and other smaller shops in and around the CBD. An
interview with a trader selling chickens stated that he has fixed suppliers from
54
where he obtains his livestock. He travels great distances such as Mooi River,
Howick and the South Coast which are almost 100 kilometre from the Market, to
purchase his stock. Traders admit that while travel costs are high when
purchasing goods from far places, buying large volumes at a cheaper price
ensures a much higher profit.
4.4.3. Traders and Crime
Traders raised concern about crime in the Bangladesh Market. Approximately
60% of the traders stated that they were affected by some sort of criminal activity
in the Market place. The rest of the traders mentioned that they did not
experience any crime at all. However, there seem to be some common patterns
with those traders that do experience crime. The stallholders who sell large
volumes and bulky goods cannot commute with their goods on a daily basis and
they therefore leave their goods that are not sold in the Market overnight. There
are no proper storage facilities and a poor security system, hence goods are left
open to theft.
Other criminal activities occurred during busy times when stalls are filled with
people and this makes it difficult for the stallholder to manage the influx of
customers and guard their stalls. This is when petty crime takes place. Some
criminal incidents take place when goods are being loaded and off loaded from
vehicles. One trader reported an incident of being hijacked just outside the
Market square where his vehicle and some cash was taken. Although many
traders were not affected by crime, 87% of the traders demanded some form of
security. Some requested overnight security, while others opted for police
presence and guards during the day.
55
4.4.4. Concerns of Traders
This section of the analysis highlights the problems and concerns that traders
argue to be the most significant barriers that face them. It was recognised by all
traders that the most important problem that they face is the absence of shelter.
At the moment traders carry gazeboes14 and their own form of shelter to protect
themselves and their goods. They argue that during inclement weather, the
goods that they sell get damaged and also the weather poses a threat to their
health. During times when it rains, traders use plastic to cover their goods. This
creates major problems for traders because most of their goods are perishable.
Presentation of goods is very important for traders to attract their customers,
inclement weather gives the goods an unappealing look and traders argue that
customers complain that goods are 'old stock' because of this.
Problems also deal with other infrastructural requirements. Many traders
complain that the sizes of their stalls are very small. This prevents them from
expanding their business by limiting them to sell a smaller variety of products and
smaller volumes of each product. This phenomenon is more common for traders
selling larger products like potatoes, onions and tomatoes. As noted above there
are no storage facilities available for the traders. The majority of the traders
complain that commuting their goods on a daily basis becomes costly and time
consuming. Stallholders argue that they have limited space at home for storage
purposes. Because of the lack of storage facilities. stallholders argue that they
cannot buy goods in bulk at cheaper rates. Damage is also incurred when goods
are transported on a regular basis.
The Market has only two toilets that are available to all its patrons. During busy
times there is a queue to enter and this poses problems because many traders
do not have the time to wait during trading hours. Due to a lack of space, the
board has limited options for further construction.
14 An informal structure made ofcloth or plastic that can be easily assembled and dissembled.
56
Approximately 40% of the traders complained that the passage way for their
customers to walk and shop is too small. This creates congestion and hinders the
flow during busy times.
When questioned about the satisfaction with goods that they are trading, there
were mixed responses. Stallholders trading in goods such as brassware, clothing
and cosmetics agree that they were comfortable however certain stallholders
selling fresh produce expressed their discontent. They argued that apart from the
weather damaging their goods, those goods that are not sold in that day either
looses its value or become rotten. This is a total loss for these traders.
Those traders that fall within the Bangladesh Market Association complain that
the pavement traders and car boot traders do not pay any rentals and are still
allowed to trade outside the Market. They argue that this is unfair practice and an
injustice to them because the traders outside the Market sell similar products and
are in closer proximity to their customers. In this sense they lose customers to
those traders outside of the Market. One stallholder commented that those
traders outside of the Market are on a 'free ride' (Fresh Produce Trader, 8/11/03).
Car boot traders complained that they are constantly being harassed by police.
Recently (October, 2003) city police served them with a notice of removal from
the area. The council argues that the car boot traders are taking up place and are
causing traffic congestions in the car park area. The car boot traders are
considered illegal traders.
4.4.5. Traders and their Interaction with "Officials"
The officials (trustees) of the Market hold general meetings for the traders once
every four months. At these meetings traders are given a chance to list all the
problems, concerns and other issues that affect them in the Market. However, in
57
the interviews the general view amongst traders towards the Association was
very despondent, stating that these meetings were futile and not fruitful. The
traders argued that the issues that were tabled were not addressed and these
were recurring issues that were subject to debate at every meeting. The common
view amongst the stallholders is that the officials are not carrying out their jobs to
their full potential. As commented by a few traders, "they just listen and make
empty promises", another comment was that the "board is serving no purpose to
the traders, it is just a formality" (Fresh Produce Traders, 15/11/03).
Stall-holders complained that council members only visited the Market during
times of elections. Councillors pledged their support and promised developments
but nothing has been done thus far. Ninety percent of the respondents state that
they did not receive assistance from any of the councillors. Only a few car boot
traders were assisted and represented by councillors during the time when the
city council served them with a notice to evict the place. Many stallholders are
now reluctant to vote in local level elections in the country.
There is a general feeling amongst the traders that a separate body is needed to
represent them. They feel that a body such as a trade union will protect them
from being exploited. It will also voice their concerns and address the problems
that they face. This body is to be separate from the main Association. At the
moment no steps are being taken to organise this body.
4.4.6. Business Skills, Training and Financial Management
Eighty percent of the respondents stated that training and skills are needed to
help the stallholders manage their finances. Other respondents felt that they
were sufficiently equipped with the knowledge and skills to manage their own
business. Those that needed the training wanted specific training relating to the
goods that they sold. Hence, two main issues were highlighted by the
respondents. Firstly, there is a need for formal education since many people are
58
illiterate or have only attended primary school. Secondly, there is a need for the
traders to be provided with business training skills. Traders want to address
issues such as recording profit margins, marketing of products and customer
relation services.
Respondents were asked if there was any money lending facilities or a banking
system in place in the Market area for the traders. It was clearly stated by all
traders, that there was no such support facility. Many traders complained that
acquiring smaller change was a problem. They argued that customers withdrew
their purchase offer because traders did not have enough change. A few traders
suggested that there should be an informal system available where credit and
change can be acquired at minimal rates to them, for example a micro lending
company.
4.4.7. Profitability of Trade and Traders Survival Strategies
Responses of interviewees on the question of profits, varied depending on the
type of goods that were sold. In Table 8, the average profits taken for each type
of good that was traded is recorded. However, it must be noted that within each
type of group profit margins varied. This variation was because certain
stallholders traded larger volumes or higher order goods than other stallholders.
Table 8: Range of products together with their net profits and expenses
Type of goods being traded Profits per month Expenses per month
Chicken R10 000- R14 000 R15 000- R20 000
Fresh Produce R1 000- R5 000 R500- R3 000
Plastic Ware, Crockery and R2 000- R 4 000 R500- R2 000
Toiletries
Groceries and Cosmetics R1 000- R4 000 R500- R 2 000
59
Chicken traders record very high levels of profit. However, their start-up capital
and running expenses are also high per month (table 8). Profits in selling fresh
produce ranges from one thousand to five thousand rands a month. This profit
difference depends on the type of fresh produce that is being sold. As can be
seen in Table 8 the expenses are much lower than that of chicken yet it yields a
significant profit. For plastic ware, crockery and toiletries; the profit margins were
also significant and the operational expenses for the month were fairly low. The
groceries and cosmetics division are similar to the plastic ware division for both
profit and expenses for the month. The major expenses for all categories include;
commodities, vehicle maintenance, petrol/diesel, transport, labour and stall
maintenance.
Certain stallholders argued that they were in a less lucrative position than other
stallholders in terms of location. Those at the far end of the Market complained
that customers shop at the front end because it is convenient and this resulted in
them being less frequently supported.
4.4.8. Trade, Regulation and Control
Initially, each stallholder had to have a vendor's permit to trade. However, as
time elapsed traders, together with the Association, thought that it was an
inappropriate means of organising and controlling themselves. A meeting held
with traders, community members and the Association led to the system that is
currently in place. Now each of the legal stallholders in the Market pay a nominal
fee of R10 a day and R20 a week to trade in the allocated space provided to
them. The stallholder has to pay for both the days irrespective of whether he/she
comes on both these days or not. According to the Association, these funds are
utilised for the daily and monthly expenses needed to run the Market. The
traders, however, feel that these funds are utilised for the Associations own
benefits. In addition to the R20 a week, stallholders have the choice of either
booking tables for their usage at a cost of R5 per table. All these costs are
60
payable by the legal traders in the Market. The pavement traders and the car
boot traders do not incur any of these costs. The only formal permit that was
acquired from the municipality was for those people selling chicken. They acquire
a licence that is renewable every five years.
When asked the question about regulating informal traders, there was a
surprising response from the respondents. Sixty percent of the respondents
argued in favour of regulation. They gave various reasons as to why they think
that this sector should be regulated and related it to their own experiences. The
main reason given was that the illegal traders in the car park and the street
traders should be moved out from their place. The traders of the Bangladesh
Market Association felt threatened by the illegal traders. Another reason was that
regulation would create a better infrastructure for them and thus address their
main concern of having a shelter in the Market area. Traders also felt that
regulation would distinguish and control the number of traders selling similar
products, in this way people would not be over trading on any commodity.
The other 40% of respondents argued against regulation. The main reason given
was that regulation would mean higher costs for themselves and since for many
of them it is a survival strategy, it would force them out of the Market. Others felt
that they would lose customers if the Market were to be regulated and
formalised.
4.5. FORMAL BUSINESSES
Those formal or registered businesses that surround the Market area selling a
similar variety of goods were selected. These formal businesses ranged from
small retail shops to larger supermarkets and chain stores.
61
4.5.1. Profile of Respondents
The sample for the respondents included males and females. In some cases the
owner of the shop was available to converse with the researcher and in other
cases the manager or a representative from the shop was available. The size of
the shops varied from selling just a few items of goods to a variety of
commodities. Some of the items that were sold in these formal businesses were
fruit and vegetables, groceries, food items, clothing, crockery, etc. These are the
same goods that are being sold at the informal trading market. These formal
businesses only developed after the Bangladesh Market came into being.
4.5.2. Relationship between Informal and Formal Businesses
Majority of the respondents from the formal sector commented that they have an
amicable relationship with the informal stallholders. A strong issue that emanated
from the formal businesses was that they are in existence because of the
presence of the informal market. They maintain that their formal businesses
would not operate if the informal market was not there. This was because the
informal market is a key draw card to people from all over Chatsworth and other
parts of Durban. During the weekdays the formal businesses are very quite but
they become busy during Friday and Saturday because the Market is open on
these two days. Many respondents from the formal businesses said that there is
a dualistic relationship between themselves and the informal traders. As stated
by one formal trader (5/09/2003), "they buy food from my shop and I buy my fruit
and vegetables from them." There is a supportive relationship between the two
different sectors. There are also instances where informal traders bought from
the formal shops and sold at the Market and vice versa.
A few respondents were against informal traders in the area. These respondents
looked at informal traders as being a threat to their formal business. It was noted
that the formal businesses selling fresh produce recorded greatest dissatisfaction
62
with informal traders. They complained that on the days that the Market is open,
customers shop at the Market and desert their businesses. Another concern was
that the informal traders keep pirate audio and visual recordings and they sell
them at a much cheaper rate than their formal counterparts.
Many of the formal businesses argued that the informal traders should be
regulated by becoming more formalised. They argued that the benefits of this
would impact positively on all the formal businesses in the area. Regulation for
them must address issues of hygiene, infrastructure and layout, the trading of
similar commodities so that the informal traders do not sell the same products as
them and lastly issues of congestion. Informal traders must therefore be
governed by regulations that address these issues.
A few formal businesses felt that they are being disadvantaged in the sense that
they pay large sums of rent and pay more for labour than the informal
businesses. The large overhead costs are what make their prices higher. In
many instances formal businesses complained that because of their slightly
higher prices clientele went to the informal market.
4.6. RESIDENTS AND THE BANGLADESH MARKET
A representative sample of twenty seven residents around and adjacent to the
Market was selected. The respondents included male and female from the ages
of sixteen years and above.
4.6.1. Residential support of the Informal Market
Of the twenty seven respondents, only one person stated that they did not use
the Market place to purchase goods. The other 26 respondents mentioned a
variety of goods that was purchased from the Market on a weekly or monthly
basis. The most common product that was bought was fresh produce followed by
63
clothing and then other items that were sold there. Most of the residents pointed
out that they rely on the Market for the basic commodities that they require. The
respondents also stressed that prices of commodities sold at the Bangladesh
Market were more competitive when compared to other markets in Durban.
Furthermore, the quality of goods was excellent, perishable goods were always
fresh and availability was commendable. A senior community leader expressed
great pleasure in shopping at the Market. He was positive about the location
stating, "I enjoy my Friday afternoons here, and it's just down my street"
(Customer, 14/11/03).
4.6.2. Advantages of Informal Activities in the Area
The most significant advantage that the residential community thought was the
convenience of the proximity of the Market. More than 40% of the respondents
that did not own motor vehicles did not have to take public transport to the
Market, instead they just walked to the Market and back to purchase their goods.
Another advantage was that the Market area offered a variety of goods that was
fresh all the time which pleased the people in the area. The service offered by
the traders was also commented on where people stated that they could bargain
for goods that were purchased unlike in the formal shops. Residents thought that
it was safe to shop at the Market during any part of the day. A few respondents
saw the Market area as a mechanism to providing employment to the people in
the area and thus keeping the youth off the streets. Youth also engaged in
livelihood activities at the Market due to the suitable trading days and hours.
School pupils earned a few rand each week by working as porters or ·carry-boys'.
Many of them also admitted that the money earned by working at the stalls or
being 'carry-boys' is used to pay school fees or complement the household
income. This actually explains why the Bangladesh Market is very much a 'family'
livelihood area as parents and children use the informal activity as a livelihood
strategy.
64
It was interesting to note that 95% of the clientele who supported the Market
also frequented shopping malls in and around Chatsworth. What was significant
to note is that their main purpose is to compare prices of goods sold at the
shopping centres, to that at the stalls in the Bangladesh Market. Notably, they
prefer to retum to the Market due to competitive and much cheaper prices.
4.6.3. Disadvantages of Informal Activities in the Area
Congestion in the parking area was seen as a major disadvantage. Residents
complained that illegal traders occupied a lot of parking spaces that should have
been for their use and this creates congestion during busy times. As a result of
the congestion in the Market, there are traffic problems on the residential streets.
The residents thought that the traders within the Market were congested. A
serious disadvantage perceived by the residents was the unhealthy and
unhygienic conditions in and around the Market area. They argued that the
traders did not clean up at the end of the day and the area in the Market was
very dirty and unsightly. This created a poor image of the area. Three
respondents complained that certain traders were rude and harassed them by
forcing them to purchase goods. Some respondents complained of the noise
pollution in the area that resulted from the Market.
4.6.4. Advantage or Disadvantage? A Viewpoint.
An astonishing revelation by an educator of the neighbouring high school,
Glenover Secondary School, who is also a resident in the area, was that market
activity upset their academic agenda as absenteeism was greatest on a Friday.
As a result they cannot set tests and exams on a Friday (Interview with Resident
Educator, 05/11/03). School pupils admit that their market activity was a source
of income and going to work on a Friday was crucial to their survival. The
communities living around the Bangladesh Market come from a low socio
economic background. Educators admit that they are aware of this and cannot
6S
impose grave punishment or change these behaviour patterns, as it is a means
of subsistence for this community. Educators also assert, whilst not condoning
absenteeism, such skills and 'hands on' "business experiences are beneficial to
most students as their academic results reveal that they are more inclined to
pursue the entrepreneur route than an academic one" (Interviews with Educators,
05/11/03). It is the view of the Educators that the Market experience was crucial
to education of the youth in the area as the Department of Education and
Training in South Africa has devised a curriculum which is outcomes based, "the
Market is actually a phenomenal concept for our learners" (Educator, 5/11/03). It
exposes them to all kinds of business skills namely planning, organising, as well
as accounting and control of financial resources, which are important life-skills.
4.7. CLIENTELE
The customers of the informal market were from different areas in Chatsworth
and the surrounding Durban regions. Again, respondents included both male and
female of the ages of twenty and above. The word clientele and customers are
used interchangeably.
4.7.1. Reasons for Shopping at the Bangladesh Market
There were numerous reasons given for shopping at the Market. Firstly, people
supported the Market on account of convenience. Some of the clients were
people who worked in the area either in the schools, hospital or other retail
stores. They purchased goods at the Market because it was on their way to work.
Secondly, customers enjoyed the variety and freshness of goods that were
available. One of the respondents commented that "it is a one-stop shop where
you can get anything that you want in this one area (Clientele, 8/11/03)". The
clientele also stated that the prices in the Market were very competitive
compared to those in the formal shops around the area and in other areas as
66
well. Some shopped at the Market because of the warm atmosphere that was
present.
4.7.2. Issues of Concern and Suggestions from Clientele
Parking was an issue for people coming with cars to the Market. Some patrons
waited for more than twenty minutes to find an available parking space. During
bad weather people found it very difficult to shop in the Market because there are
no shelters. A few respondents found that the area where chickens are being
sold to be dirty, smelly and unhygienic. Customers thought that traders should
extend their trading days to include Sundays as well, so as to make it more
convenient. This will reduce the congestion as customers will have longer trading
hours. Informal interviews with car-guards reveal that guarding cars was their
only income, and it was lucrative. They expressed that bad weather was not an
issue "life is full of hardships, at least this helps me buy bread and milk for my
family" (Car-guard, 01/11/03). "People need us to direct traffic because of
congestion and female shoppers feel safe with us being around" (Car-guard,
1/11/03). It appears as though residents and clientele alike find the Market to be
a very important part of their lives and economic activities.
Customers expressed discontent about the fact that goods purchased at the
Market, for example clothing cannot be returned if unsuitable, neither do they
receive a refund. Trader's response in defence of this was that, apart from being
unhygienic to accept sold (possibly worn clothes), they could not guarantee that it
was purchased there at the Market because "we do not sell a particular brand of
clothes, so we are not sure whether it was purchased from us or a formal outlet"
(Trader, 29/10/03). Traders buy goods wherever it is reasonable and as long as it
allows them to make a profit from resale. They do not issue cash sale slips or
receipts due to the informality of their trading activities.
67
4.8. MARKET ACTIVITY, RESIDENTS AND THE ASSOCIATION
The Market lies within a residential area flanked by shopping centres, a church, a
creche, a gym and other small business activities. Residents and other
neighbours complain to the Association of the unhygienic conditions created by
the vendors. The Market's immediate neighbours complain profusely about
refuse being dumped onto their premises by inconsiderate untidy vendors.
Neighbours say traders are negligent and will pursue their business activities at
any costs. This is of concern and it is hoped that the formal structures as planned
for the new market, will help mitigate such problems by better control
mechanisms. The Association has to look at all these problems and find
appropriate solutions.
4.9. THE NEW "PROPOSED" MARKET
Negotiation for the new market began around 1998. A qualified architect has
drawn up the plans. The Chairman of the Bangladesh Association is pleased that
plans for construction are in its advanced stage. However, now that Council has
a contractual stake in the Market, they have proposed a massive structure with
estimated cost of approximately R8 million. The Bangladesh Association
objected to such a proposition stating that it will become too formalized and that
a marketplace of such standard would mean that poor traders will have to pay
more rentals which will disadvantage the smaller traders. This would eventually
result in the withdrawal of many traders from the Market place, hence losing their
means of income, as it has been indicated by these small traders, that this is the
only source of income for many traders at the Market. Bangladesh Market
Association then suggested a plan which they had approximated cost at about
R2 million which will provide affordable basic trading facilities that meet the
demands of the traders in the Market square. The Association is also prepared to
go into a partnership with the Council in order to finance this project. At the
moment negotiations are still taking place.
68
4.10. CONCLUSION
"The Market, situated behind the Westcliff Shopping Centre, has become popular
with visitors and residents in the bustling suburb of Chatsworth where one could
buy anything from vegetables to hairpins" (Post, 2003: 19). The Bangladesh
Market has impacted on the lives of all those that came into contact with it, be it
the customers, the residents or the formal businesses in the area. Tracing the
history of the Market and looking at its progress through the years, it can be
deduced that the Market has tremendous potential for future growth and
development, not only for the Market but for all the stakeholders involved.
69
CHAPTER FIVE
DISCUSSION, RECOMMENDATIONS AND CONCLUSION
5.1. INTRODUCTION
The primary aim of this study attempts to understand the dynamics of informal
trading in the Bangladesh Market, looking specifically at how the social,
economic and political effects have advanced or not advanced the Market in
becoming a powerful informal economy. Against this backdrop, the views and
experiences of various role-players/stakeholders constitute the analysis in
chapter four. This chapter presents an overview of the informal economy and
some recommendations are made based on the analysis.
5.2. DISCUSSION
Bangladesh Market has proven to be a hub of social, economic and political
activities. Whilst it has been informal from the inception, market dynamics has
revealed that there is a remarkable inter-relationship between all different
stakeholders in the sector. The research indicates that the Bangladesh Market
impacts on lives of the residents, traders, consumers and neighbouring
businesses. Each proving to contribute to the sustainability of the other in the
long-term.
Although, the Bangladesh Market is a 'part-time' activity, which operates twice a
week, it impacts on the lives of all involved for different reasons. Whilst the
hypothesis of the study raises concerns about its aesthetic appeal, it is a concept
that residents have adopted as part of their daily lives, highlighting positive
impacts rather than negative. The benefit of the Market activities obscures the
few problems it poses in the surrounding areas. It serves the needs of the
residents who are of a low socio-economic background. Bangladesh Market is an
important source of supply of goods that are in demand. These are made
70
available at the right price and quality which appeals to all its consumers from the
vicinity and afar. Furthermore, the research undertaken focused primarily on the
economic benefit of the Market to its immediate neighbours who include
residents and surrounding businesses. It is the primary source of income for
some of the traders and boosts the turnover of surrounding businesses by
attracting of customers.
Although, a call for formalisation and more support for traders were identified,
traders appear to be satisfied with such informal activity as their main source of
income. They have an amicable relationship with one another and a symbiotic
relationship with other stakeholders such as residents, traders, neighbouring
businesses as well as other informal 'illegal' trade activities which have become
survival mechanisms for those involved. However, policy and spatial planning of
the area require some redress in order to address the concerns raised by the key
respondents who are the traders. At the same time careful consideration and
caution need to be exercised by policy-makers on the impact of revised policy
and formalisation of activities as these may prove to counter-benefit those who
rely on the income derived from engagement in the informal trading sector.
5.3. RECOMMENDATIONS
In order to allow the informal economy to grow and develop and at the same time
to improve the overall quality of the urban environment, the following
recommendations are made.
These recommendations relate specifically to the informal trading market in
Bangladesh.
a) In order to address the most serious problem facing the traders, suitable
shelter should be provided to all legal traders within the Bangladesh
Market. This sheltered facility should be cost effective so that the traders
71
do not bear the brunt by paying high rentals in order to recover the costs.
It was suggested by the Association that the proposed new market would
result in an increase in rental tariffs for the traders.
b) More space has to be provided in the Market allowing the car boot traders
to trade within the legal trading area. In this way traffic congestion in the
car park would be prevented. There is vacant space behind the Market
which can be used for the car boot traders.
c) The traders in the legal trading area, together with the pavement traders
and the car boot traders, should form one united body where issues of
concern are discussed and addressed. In this way they would form a
stronger representative body empowering them to negotiate with the
council regarding the problems facing them.
d) The Bangladesh Market Association and the eThekweni Council must
work jointly to eliminate the problem of pollution and unhygienic
conditions in and around the Market. This was identified as a concern by
the surrounding residents of the area.
e) Proper security should be provided in the vicinity of the Market to create a
safe and conducive environment for all its users.
f) Since many people travel to the Market from all over Durban, reliable
public transport arrangements must be made for the traders and the
clientele. Currently, traders take two or often three taxis to the Market and
the same to return home. These public transport arrangements should
include where the pick up and drop of stops are and how often.
g) It was evident from the interviews that the majority of the traders lacked
the business skills and education to expand their business and make it
72
more profitable. Many of the traders indicated that they would be
interested in attending a programme that will equip them with the
knowledge and skills to become successful entrepreneurs, the
Association should look at workshops and programmes that will fulfil this
need for capacity building.
h) Whilst the informal economy is recognised as a livelihood strategy for the
poor, traders of the Bangladesh Market strongly appeal for territorial
control of traders admitted to the Market. Traders are of the opinion that
Bangladesh Market is the most viable market place in Durban. It attracts
people from all over KwaZulu-Natal which restricts local people from
access to income on their doorsteps. The Association therefore needs to
address this problem by adopting stricter control measures that gives the
locals preference over traders from other parts of KwaZulu-Natal, in the
Market. As advocated in the literature, this will constitute local economic
development by creating jobs and reducing poverty and crime in the
vicinity.
i) Since many of the clientele complained that the Market is open only for
two days, the Association needs to look at the viability and profitability of
the Market being open on at least two more days. On days in which the
Market is not in operation, the Association can look at allowing other
users to occupy the premises, like a flea market. In this way the area is
always in use and more funds can be generated for developments in the
Market.
j) There should be a facility that provides specifically traders with credit and
finance options so that they can expand their business and continue to
operate during times of financial difficulties. The Association should take
the responsibility of managing this facility.
73
k) Meetings concerning issues affecting traders and the financial
management of the Market need to be held more regularly at least bi
monthly so that traders are informed, and transparency and accountability
is encouraged amongst all stakeholders. This is because traders are
unclear about the financial management and audit activities of the
Association. This hinders their trust and the need to cooperate with the
Association thus preventing a healthy relationship.
The next three recommendations are broad based referring to the informal
economy in general.
I) Policies should aim to improve and enhance conditions in the informal
sector. Policy issues should address gender inequalities and also produce
a strategy to reduce gender oppression. Other important issues that need
to be addressed are the lack of skills training, educational opportunities,
adequate health care, business premises, credit and finance. All of these
are of vital importance for the informal economy to function as a whole. In
earlier discussions it was established that the lack of proper skills and
adequate education formed the basis for people in the informal economy
to be exploited. When providing these proper skills and education,
appropriate technology should be introduced to facilitate the process.
Technology can serve a dual purpose of enhancing the lives of those
involved and also in boosting the economic performance of the informal
sector.
Policies aimed at street trading should be inclusive and holistic. "The
ultimate aim of street trading policy should be geared towards a process
that sees street trading as an initial entry point into more substantial
trading opportunities, where a series of incentives should be provided that
will encourage successful street traders to move up the economic ladder"
74
(Witt, 2000: 56). Policy should also look at the provision or development of
an institutional and physical structure to facilitate growth.
The government can therefore play a critical role in implementing its'
policies. The overall position taken by the government should be a
promotional initiative towards the informal sector. When formulating
development policies, the government should seek the advice and inputs
from the private sector as well as from the various NGO's concerned. In
this way a more integrated approach can be established. This integrated
approach should form links with other government sectors such as
tourism, trade and environmental issues. If this can be achieved then we
will have a much more coherent policy framework to work with. The
government can also provide incentives and motivational programmes to
ensure the full participation of individuals especially the women and the
youth.
m) The words gender, poverty and discrimination are synonymous with the
informal economy. There should be specific policies and programmes that
address gender inequality in the informal economy. These policies should
include providing training, skills and education to those women entering
and already in the informal economy.
n) At the moment official statistics on the informal economy are unclear.
Further research needs to undertaken, this will generate critical
information that will eventually guide policy.
5.4. CONCLUSION
The research identifies that high priority should be given to formulate a coherent
policy framework within which the informal sector can be developed. Informal
traders require co-operative relationships with the state, private sector and civil
75
society which impacts on each other. In addition, a more integrated approach
should be taken where there would be greater participation of individuals
especially the women and youth who should be involved in the planning, decision
making, implementation and evaluation of the entire process, since the findings
from the research reveal that women and youth form the major constituents of
the informal economy. The informal sector has become an integral part of the
social and economic structures in society. It is also being realized that the future
of the informal sector is extremely important in order for growth and development
of a country to occur.
The informal traders in the Bangladesh Market share similar concerns and
problems that street traders in other parts of the country and the world
experience. However, as have been mentioned earlier, policies have to
recognize the diversity of street traders in this area and the contexts in which
they are operating. Drawing from the analysis, it can be said that the regulation of
the informal sector would lead to its demise whereby it will force most of the
traders out of the system.
The Bangladesh Market can be seen as a typical example where an informal
economy has thrived and grown in its natural existence. The future success of
trading in the Bangladesh Market will depend on creating an enabling and
supportive environment in which traders can develop their businesses so as to
work in harmony with the rest of the community. This is a challenge that planners
and policy makers face in the era of development in the twenty first century.
76
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80
APPENDICES
Appendix 1
Questionnaire for Street Traders
1. What type of good/s are you trading?
2. Is it your own stall or are you running it for someone else?
3. If it is not your own stall, who are you running it for?
4. Why did you decide to locate yourself here?
5. Are you comfortable with your surrounding in terms of congestion andaccess to your customers?
6. Can you explain why you are comfortable or not?
7. A. Is your business affected by crime?
IYes O __N_o--,O7. B. If yes what criminal experience/s did you have?
8. What forms of security you think is needed at this centre when you aretrading?
81
9. How long have you been in this informal trading business?
10. Where do you get your supply of goods from and how often?
11.Are your suppliers reliable?
12.Are you satisfied with trading in this type of good/s and why?
13.Where do you store your stock?
14. Do you have problems with storage, if yes what are they?
15. Did you receive assistance from any of the councilors?
IYes I=:J'--_N_o-----JU16.lf so, what assistance did you receive?
17. Can you manage on your own or do you need help from the Board?
82
18. Do you feel that you need a body to represent you so as to help you growand develop?
19. Do you feel that there is a need for traders to be provided with necessarytraining and skills so that they can work better and make more profit?
IYes O'---_N_o_020. Explain further?
21. What money lending facilities are available?
22. Did you take a loan to start the business?
IYes CI__N_o_O
23. Where you formally employed before this?
IYes D __N_o_D24. If yes, where were you employed and what happened?
25. How often do you trade here?
26.About how many hours does it take you to prepare for trading here?
27. What does it involve to prepare for trading?
83
28. How are the working conditions here?
29.ls this your only source of income?
IYes 1=:JL....--N--'-o_D30. If no what are your other sources of income?
31. How many dependants do you have?
32. How profitable is it to be in this type of business?
33. What were your last month's average monthly expenses?
100-499 500-999 1000-1999 Over2000
34. Are these the normal monthly expenses?
34. What were the expenses for last month spent on?
35. What is the average monthly income generated?
100- 999 1000-1999 2000-2999 3000-3999 4000-4999
36. Do you need a permit to trade here?
IYes
84
37. Explain?
38. How do you feel about regulations on informal traders?
39. Have you been approached by the authorities, if yes in relation to what?
39.lf you have a problem whom do you go to?
40. What could be done to make it easier for the traders?
41. Who should take this responsibility?
42. Age
43. Gender
IMale D Female [J
44. What is the highest standard passed?
85
Appendix 2
Questionnaire for Residents
Interview notes:Respondent number:Date:Location:
1. What is your relationship to the head of the household?
2. How do you feel about the informal trading activities that are being
practiced in the area?
3. Do you use the informal trading market?
IVes 0 No 0
4. If yes, what do you buy?
5. Where else do you shop, why?
6. Do you see any advantages of the informal market located in the area?
IVes I=:J'---_N_o---'O
86
7. Can you explain what are the advantages or disadvantages of the informalmarket in this area?
9. What kind of problems do you experience with the informal traders?
10.Are you experiencing problems with the informal trading market in terms of
Traffic Noise Air Attracting Dirty! Othercongestion pollution pollution criminals unpleasant
environment
12.Gender
IMale D Female D
87
Appendix 3
Questionnaire for Formal Business
Interview notes:Respondent number:Date:Location:
1. What type of business do you have?
2. How long have you been operating here?
3. Why did you decide to locate here?
4. What is the relationship between yourself and the informal traders?
5. Does the informal market affect your business, if yes how?
6. Do you feel that these informal businesses should be more regulated, Ifyes why?
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Appendix 4
Questionnaire for Clientele/Customers
1. Where do you live?
2. Why do you shop here?
3. What time of day do you usually shop here?
4. How often do you shop here?
IDaily Cl Weekly o Monthly D Less often o5. What did you buy today?
6. Is it convenient for you to come and get goods and services in this informalmarket?
IYes D_...:-N-,-o--lD7. Explain why it is convenient or inconvenient?
7. Are the prices better here?
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8. How do you feel about the range of goods that are available in thismarket?
10. Can you explain the type of service provided to you by the traders?
11.Why are you comfortable or uncomfortable shopping here?
12.What could be improved?
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Appendix 5
Questionnaire for Informal Traders Board
1. What is your role/position on the board?
2. How does the board operate (technical)?
3. What is the function of the board?
4. What is the long term goal and vision of the board?
5.1. Who administers the operation of the market and how often?
5.2. What does this entail?
6. Is there a lack of resources here, if yes what resources are needed?
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7. To what extent do the informal traders comply with the rules andregulations of the board?
8. Are there any complaints from residents or the formal businesses? If yeswhat are they?
9. What is being done in response to these problems?
10. What are some of the main issues that the traders complain about?
11 . What is being done about this?
12. Are there specific times allocated for trading?
13. What linkages are there between the road traders and the car park traderswith that of the association?
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14. Is there a new compleong to be built for the street traders?IVes D No
14.1. If yes, where is the new complex going to be built?
14.1. How is the complex going to be funded?
14.3. What will this mean for the street traders?
14.4. When will this complex be completed?
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